timmint mi - luxury weekly report (issue 2014-19)

-

GLOBAL LUXURY

Weekly Report

Issue - 2014 Week 19

5th to the 12th of May, 2014

TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th

to 12th

of May 2014

2

From:

TIMMINT Market Intelligence

To:

Whom it may concern

Subject:

Weekly Report, Luxury industry

Issue Year 2014, Week 19

Report Sections

Global Luxury News

Stock Market Performance

Companies Stock Charts

Who We Are

The TIMMINT Group is specialized in providing professional services to the

worldwide business community.

This report was prepared as an account of work sponsored by the

Company. Certain information has been obtained from published

sources and is given as of the dates specified. All the information in this

publication is verified to the best of the authors’ and publisher’s ability,

but neither the company nor the Management Team makes any

warranty, express or implied, or assumes any legal liability or

responsibility for the accuracy completeness or the results of such use

of the information. All such information is subject to change without

notice.

Disclaimer:

For More Info

VISIT OUR WEBSITE

http://www.timmint.com/


to 12th

of May 2014

3

Global Luxury

News


to 12th

of May 2014

4

Luxury means you need to own it to be satisfied

Study finds respondents who were able to keep the luxury versions of the products they tested were more

satisfied with life.

What makes you feel more happy: Your affluent buddy allows you to take that box of foreign-brand

chocolates home or just lets you taste one when you visit his/her place? Researchers have just

read your mind.

According to a new study, ‘feel good’ factor is higher when you own, not just use, luxury

items. “Just using an affordable luxury item you do not own can, in fact, dampen the feel good

factor that normally surrounds such products,” said Liselot Hudders and Mario Pandelaere

from Ghent University in Belgium.

To test the link between luxury consumption and well-being, the researchers presented 307 study participants

with luxury and ordinary versions of either a durable pen or a chocolate box. The respondents who were able

to keep the luxury versions of the products they tested were more satisfied with life than the participants who

received the low-budget versions.

On the other hand, the well-being of participants who could

not keep the luxury versions they evaluated was significantly

lower than that of respondents who evaluated the plain

versions. Another interesting finding from the non-ownership

category is that these participants were significantly more

satisfied with their life after using the chocolate than after

using the pen.

“The finding that people are more satisfied with life when they own luxury products than when they only get

to use them is in line with prior research that equates consumption with ownership,” Hudders said. “In

contrast, the mere use or mere knowledge of luxury products seems to be detrimental for one’s satisfaction

with life,” Hudders noted.

Source: Gulf News

Own! Don’t

just use


to 12th

of May 2014

5

Market Pulse | Upbeat Results

The Savigny Luxury Index (“SLI”) leaped by 3.5 percent last month, as the feel-good factor returned to the luxury sector, underpinned by strong results announcements and positive market reaction to repositioning strategies.

The Savigny Luxury Index (“SLI”) leaped by 3.5 percent last month, outperforming the MSCI World Index

(“MSCI”) by five percentage points. Most of the SLI components have had impressive increases this month as

the feel-good factor returns to the luxury sector, underpinned by strong results announcements and positive

market reaction to leading groups’ repositioning strategies.

Big news

• LVMH’s repositioning of its core brand Louis Vuitton is starting to pay off, which has had a boosting effect on

the whole sector. The group posted much higher than expected fashion and leather sales in its first quarter

results, propelled by creative momentum at Vuitton. Gucci continued its upmarket repositioning with flat

sales in the quarter being affected by the clean-up of its wholesale network. Nevertheless, Kering’s luxury

division posted an impressive sales increase of over 6 percent for the quarter, driven by star brand Bottega

Veneta and a much re-invigorated Saint Laurent. The group announced a re-organisation of its luxury division

into three groups: Gucci, Couture & Leather Goods and Watches & Jewellery. Mulberrry reversed its

upmarket strategy to revert to doing what it does best — affordable luxury handbags.

• The sector benefitted from a short-term sales rush in Japan as Japanese consumers rushed to the shops in

anticipation of VAT hikes. Hermès benefitted greatly as Japan is still its biggest market: the group posted

forecast-beating first quarter results. LVMH saw its revenues in Japan rise by over 30 percent (in local

currency) over the quarter.

• Currency movements continue to eat into the sector’s bottom line. Burberry saw strong progress in its sales,

up almost 20 percent in the first half, but warned again that currency headwinds would affect this year’s

results and could have a material impact on 2015 results. Luxottica, which makes over half its sales in North

America, said currency volatility has shaved more than five percent off reported revenue for the first quarter.

Kering expressed concern over the Ukraine crisis’ impact on the rouble: its menswear brand Brioni generates a

fifth of its sales from Russian clients.

• Italian brands continue to be the focus of M&A activity. Versace agreed a 20 percent capital increase to

Blackstone, whilst Cavalli looked to be sold to Permira for Eur450 million. In other news, Labelux announced

its intention to float Jimmy Choo this autumn.


to 12th

of May 2014

6

Going up

• Most of the SLI components have recorded high single digit monthly increases fuelled by good quarterly

results.

• Estée Lauder recorded the highest increase with a 8.5 percent jump as the beauty sector gets investors

attention following Elizabeth Arden bid rumours.

Going down

• The big loser this month is Coach whose share price tumbled over 10 percent after it posted a 21% plunge in

its third quarter sales in North America, its main market. The brand continues to lose ground to fast-growing

rival Michael Kors.

• Other US stocks such as Ralph Lauren (down almost 6 percent) and Michael Kors (down over 2 percent) have

suffered as investors anticipate the effects of the tapering of the Fed’s quantitative easing.

What to watch

Men are getting more attention than they ever have! According to a Bain study, menswear is the fastest

growing category in fashion and is set to continue growing at a faster rate than womenswear globally. Men

are already the dominant purchasing power in emerging markets and menswear is becoming as important a

category as womenswear in developed markets. Leading groups LVMH and Kering are focusing on this

category with their investments in Berluti and Brioni respectively, whilst predominantly menswear brands

such as Kiton, Tom Ford and Zegna have been growing at stellar rates. Prada has announced this month that it

aims to almost double its menswear sales to €1.5 billion over three to five years and open more dedicated

men’s shops.

Source: The Business of Fashion


to 12th

of May 2014

7

How luxury has become a competitive tool for airlines

For most travelers, flying in style may be a thing of the past, but airlines are determined to bring back some

glamour to air travel, at least for those sitting in the front of the plane.

Flat beds and fluffy pillows, fancy wines and four-course meals, designer-brand pajamas and luxurious vanity

kits, these options have become the staple of business-class travel these days.

And after a couple of sluggish years, business travel spending in the United States is forecast to grow by 7.1

per cent to $293 billion in 2014, according the Global Business Travel Association. Spending on international

travel is expected to increase almost twice as fast, at 13 per cent, to reach $37 billion.

"Corporate passengers are definitely being fought over

by all the airlines," said Claudia Sender, the chief

executive of TAM Airlines, the Brazilian carrier. "They

have never been so important because of their

willingness to pay more."

Airlines have always treated their business-class passengers a little better than the rest. But in today's era of

mass travel, the extra attention to the front of the cabin has increased disparities in the air as never before.

"The gap between what's going on at the front of the plane and in the back has never been wider," said Tim

Winship, publisher of the FrequentFlyer.com website. He added: "If you're one of the lucky few who flies first

or business class these days - it's as good as it's ever been. It's all about profitability.

Given the disproportionate contribution from high-yield customers, it would be financially irrational for the

airlines not to take this into consideration."

Airlines typically charge six to eight times as much for business class as for coach on long-haul, international flights, and two

to three times as much for first class as for business class. For a passenger booking a month in advance, Cathay Pacific, for

instance, can charge $900 for a round-trip economy ticket from Los Angeles to Hong Kong, $6400 in Business class, and nearly

$16000 in first class.

Source: The Times of India

Business travel spending in

U.S. to grow by 7.1% to $293

billion in 2014


to 12th

of May 2014

8

Mercedes-Benz betting big on Punjab market

Having recorded an impressive growth of 40 per cent in Punjab in the last calendar year, German luxury

carmaker Mercedes-Benz is betting big on Punjab market.

As part of its strategy, the company has further strengthened its presence in the state by inaugurating the

state’s largest luxury car dealership in Mohali near Chandigarh. Currently, the company has its dealership in

Chandigarh, Ludhiana and Jalandhar in Punjab.

The state contributes seven per cent of the company’s total national sales. Last

calendar year, the company sold 9003 units across India, a growth of 32 per cent

over the previous year. The Punjab market grew by 40 per cent during the period,

clearly indicating that the state has immense potential for the car

maker. Also, in the first quarter the current year, the Punjab

market seems to be in sync with company’s national sales

growth of 27 per cent.

With establishment of the state-of-the-art 3S facility at Mohali, Mercedes-Benz India

now enjoys a network spread across 36 cities with 64 outlets and retains the

distinction of being the leading luxury car manufacturer with the widest and most

qualitative network of sales and after-sales services.

A total of 11 new outlets are planned for 2014 of which four outlets have already been inaugurated including

Mohali and remaining are scheduled during the year.

Meanwhile, the company also commenced its Grand Tour of the award winning vehicles comprising the A-

Class, E-Class, B-Class and GL-Class on Monday. This convoy of gold foiled cars will be visiting 23 cities across

India in next 45 days as part of Mercedes-Benz India’s ‘Celebrate Excellence’ campaign. The convoy will also be

visiting Karnal, Chandigarh, Ludhiana and Jalandhar to celebrate the excellence of the Three Pointed Star.

Source: Business Standard

9003 units sold

across India in

2013


to 12th

of May 2014

9

Stock Market

Performance


to 12th

of May 2014

10

Top Luxury Companies by market Cap

The table below shows the top 20 luxury companies by Market Cap listed in the stock markets and

their weekly percentage change at the closing stage of this week:

# Company Name

Market Cap (12th of May) (USD billion)

Market Cap (5th of May) (USD billion)

% Change

1 Lvmh 98.86 99.44 -1%

2 Daimler 97.6074 98.3147 -1%

3 Diageo 77.2524 77.8122 -1%

4 Nike 64.1 64.1 0%

5 Christian Dior 36.915 37.113 0%

6 Hermes 36.846 37.0435 -1%

7 Porshe automobile 33.44 33.44 0%

8 Pernod Ricard 31.5606 31.831 -1%

9 Estee Lauder 28.04 29.34 -4%

10 Kering 27.1722 27.8139 -2%

11 Luxxotica 26.703 27.1745 -2%

12 Tesla motors 26.16 26.16 0%

13 Prada 20.8897 20.8897 0%

14 Harley Davidson 15.99 15.99 0%

15 Ralph lauren 14 14 0%

16 Beam 13.8 13.8 0%

17 Lindt & Spruengli 12.7512 12.5517 2%

18 Coach 12.18 12.18 0%

19 Nordstrom 11.76 11.76 0%

20 Tiffany 11.51 11.39 1%

The below graph shows the top 5 companies

that had the highest increase in market cap

(last week):

The below graph shows the 5 companies that

had the highest decrease in market cap (last

week):

2% 2% 2%

1% 1%


to 12th

of May 2014

11

The table hereunder shows the top 15 luxury companies by P/E ratio and their weekly percentage

change last week:

# Company Name P/E Ratio (12th of May) P/E Ratio (5th of May) % Change

1 Yoox spa 116.86 116.86 0%

2 Group FNAC 38.72 38.72 0%

3 Blue Nile 37.29 37.29 0%

4 Luxxotica 35.35 35.88 -1%

5 Hermes 33.33 33.33 0%

6 Beam 33.22 33.22 0%

7 Harman International 29.55 29.55 0%

8 PVH corp 28.24 27.8 2%

9 Shiseido 27.65 27.65 0%

10 Remy cointreau SA 27.43 27.43 0%

11 Treasure wine estates ltd 26.8 26.8 0%

12 Estee Lauder 26.54 28.43 -7%

13 Tempur sealy international inc 26.34 26.34 0%

14 Salvatore ferragamo 25.56 25.56 0%

15 Polaris Industries 24.71 24.71 0%

T A K E A B R E A K

http://timmint.com/ttg/tip_details.php?id=21








to 12th

of May 2014

12

Laser lighting has several advantages over traditional LED headlights, the first of which is better range in the high-beam mode. The

R8 LMX, which has LED headlights for normal daytime use, has laser headlights that are activated at speeds of over 60km/h to

enhance visibility and thus improve safety.

A system of sensors and cameras allows the car to detect the presence of an oncoming car and to adjust the position of the headlights

to avoid blinding other drivers.

A combination of LED and laser headlights is also featured on the Audi R18 e-tron, which will become the first car with the

technology to compete in the Le Mans 24 Hours Race (June 14-15).

Under its aluminum body, the Audi R8 LMX packs a 5.2-liter V10 engine with up to 570hp. The sports car boasts 0 to 100km/h

acceleration in just 3.4 seconds and can reach a top speed of around 320km/h. The vehicle's fuel consumption averages 12.9 liters per

100km, or 299g/km of CO2 emissions.

Produced in a limited edition and exclusively in blue, the Audi R8 LMX is expected to go on sale sometime this summer. Prices have

not yet been announced, although they will likely exceed $275,000.

Audi launches first production car

with laser lights

Source: Times live


to 12th

of May 2014

13

8.08

6.44

5.38 4.99

3.80 3.76 3.58 2.74 2.63

1.95 1.91 1.54 1.50 1.27 1.24

Tesla

mo

tors

Da

vid

Jo

ne

s

Co

ach

Trea

sure w

ine

estates ltd

Pra

da

Da

imler

Nik

e

Este

e La

ud

er

Sh

iseido

Bea

m

Cro

wn

ltd

Ha

rley D

av

idso

n

Bu

rbe

rry

No

rdstro

m

Ca

llaw

ay

30 days average volume (in millions)

125%

47% 36%

14% 13% 7% 4% -1% -4% -8% -8% -10%

Tesla

mo

tors

Da

imler

Po

rshe

au

tom

ob

ileh

old

ing

Nik

e

Lv

mh

Ch

ristian

Dio

r

Este

e La

ud

er

Lu

xx

otica

Herm

es

Pern

od

Rica

rd

Dia

ge

o

Kerin

g

Yearly % of Change


to 12th

of May 2014

14

COMPANIES STOCK

CHARTS


to 12th

of May 2014

15

Top 12 Luxury Companies Charts

The charts below reflect the index movement of the top 12 companies that had the highest market cap

during this week:

Price Change

Begin High Low End Value %

172.6 203.23 154.95 194.51 21.91 13%

* One year data *Market: US * Currency: US Dollar

Price Change


43.78 71.27 43.02 64.55 20.77 47%

* One year data *Market: France * Currency: Euro

Price Change


24.79 25.4 21.23 22.71 -2.08 -8%


Price Change


64.51 80.26 59.11 73.45 8.94 14%

* One year data *Market: US * Currency: US Dollar

Price Change


136.283 149.26 121.28 145.78 9.497 7%


Price Change


93.882 95.92 78.78 86.19 -7.692 -8%

* One year data *Market: Germany * Currency: Euro


to 12th

of May 2014

16

Price Change


174.2 185.15 136.95 156 -18.2 -10%

* One year *Market: France * Currency: Euro

Price Change


70.71 76.24 63.63 73.24 2.53 4%

* One year *Market: NYSE * Currency: US Dollar

Price Change


7.8 11.24 7.25 10.6 2.8 36%

* One year *Market: US * Currency: US

Price Change


40.93 42.97 35.22 40.47 -0.46 -1%

* One year data *Market: Italy * Currency: Euro

Price Change 34 194.5 32.85 138 104 306%


80.99 265 78.11 182 101.01 125%

* One year *Market: US * Currency: US Dollars

Price Change


266.5 283.2 223.95 256.5 -10 -4%

* One year *Market: France * Currency: Euro


to 12th

of May 2014

17

Office – LEBANON

Email

https://www.facebook.com/The.TIMMINT.Group

https://twitter.com/Thetimmintgroup

http://www.linkedin.com/in/thetimmintgroup











