LVMH achieves record results in 2006 — New growth objective for 2007

Wines & Spirits: strong increase in volumes and improvement in product mix Wines & Spirits saw organic revenue growth of 14% in 2006, with growth accelerating in the last quarter of the year.  Profit from recurring operations increased by 11% to 962 million Euros. The champagne business saw a sustained volume increase over the period, with an improvement in product mix favoring the prestigious cuvées and rosés.  Moët & Chandon recorded a solid performance in its traditional markets as well as strong development in Central Europe and in China. Dom Pérignon secured its place as the world leader in the luxury champagne market and saw remarkable growth in Japan.  Veuve Clicquot recorded continued growth in the US and the UK. Krug and Ruinart continued their momentum with a double-digit growth in volumes. Hennessy cognac progressed well in 2006 with its premium qualities recording the highest growth.  Hennessy once again achieved rapid growth in its key markets, notably the US.  China’s continued growth confirmed the potential of this market. The repositioning of Glenmorangie whisky continued successfully in all of its markets and the brand strengthened its position in the US and Europe. Belvedere vodka accelerated its growth. Fashion & Leather Goods: another exceptional year for Louis Vuitton and confirmed success of Fendi Fashion & Leather Goods recorded organic revenue growth of 11% in 2006.  Profit from recurring operations increased by 11% to 1 633 million Euros.  Louis Vuitton strengthened its leadership position in 2006 and once again achieved double-digit organic revenue growth and an exceptional level of profitability.  It saw strong momentum across Europe, Asia and the US.  A number of new leather goods products have been launched this year, such as Mini Lin, Monogram Groom, and Miroir as well as Damier Azur, which, once again, reveals the brand’s creative energy. Louis Vuitton continued the expansion of its retail network.  The inauguration of  Louis Vuitton’s ‘Maison’ in Taipei, the new store in Macao and the first operations of the brand in Ukraine, Hungary and Norway, have been some of the year’s highlights. Fendi made good progress in 2006 and strengthened its leather goods lines. 2006 also confirmed the growth potential of several brands such as Berluti and Marc Jacobs. Perfumes & Cosmetics: profitable growth Perfumes & Cosmetics recorded an increase in revenue of 11% and a 28% increase in profit from recurring operations. Parfums Christian Dior continued its growth momentum in all regions and gained market share.  The perfumes J’adore, Addict and Miss Dior Chérie posted excellent performances.  The new Rouge Dior is a major success and its skincare lines, particularly Capture, have progressed well.  The launches of Guerlain’s Insolence, Ange ou Demon by Givenchy and KenzoAmour by Parfums Kenzo have also contributed to the strong growth of this business group.  The rapid development of the younger brands is equally notable. Watches & Jewelry: strong growth and continued improvement in profitability Watches & Jewelry recorded organic revenue growth of 28% over the year, much higher than that of the industry. Profit from recurring operations increased by 281% and the operating margin rose to 11% in 2006.  TAG Heuer again grew its market share and posted an excellent performance worldwide while continuing its highly innovative upscale positioning.  The brand’s iconic Aquaracer and Carrera lines have been very strong. Zenith improved its growth in the US, Europe and in Asia and successfully introduced its sports line Defy.  Montres Dior continued its development, driven by the success of its Christal line.  Chaumet opened its flagship store in Hong Kong and has strengthened its distribution network in Europe. De Beers recorded strong revenue growth in Japan, the UK and the US, and opened inaugural stores in Dubai and Taiwan. Selective Retailing: increased results and excellent performance of Sephora Selective Retailing recorded organic revenue growth of 9% and a rise of 15% in profit from recurring operations. DFS benefited from its growing Asian clientele in a market that has been affected by the weakness of the yen.  As part of its strategy to move further up-market, DFS continued the renovation of its Galleria at Guam.  Elsewhere, an agreement has been signed for the construction of a Galleria at Macao, which is expected to open in 2008. Sephora continued to expand in Europe, in the US and in China.  Its growth accelerated in Europe, led by good progress in France.  In the US, there has been double-digit growth in comparable store revenue for the sixth consecutive year.  Online sales now constitute a significant activity in the US and have begun well in France.  The innovation culture in products and client services has continued. Favorable growth prospects in 2007 Following an excellent 2006, LVMH is well positioned for 2007. The Group will continue its strategy of concentrating on internal growth and the development of its leading brands. LVMH has set itself an objective of a significant growth in its results for 2007. The geographical spread of its activities, the strength and the complementarity of its brands and the exceptional talent of its teams will enable the Group to gain market share and to further strengthen its lead in the global luxury goods market. Dividend increase of 22% At the Annual General Meeting of Shareholders on May 10 2007, LVMH will propose a dividend of 1.40 Euros per share, an increase of 22%.  An interim dividend of 0.30 Euros per share was paid out on December 1st 2006. The balance of 1.10 Euros will be paid on May 15, 2007. Regulated information related to this press release is available on our internet site www.lvmh.com.