Welcome to the LVMH First Quarter 2016 Revenue Conference Call. I will now hand over to Mr. Chris. Sir, please go ahead.
Hello. I'm Chris Hollis, Director of Financial Communications at LVNVH. With me is Georges Guillenie, our Chief Financial Officer. As in previous periods, these revenues figures are reported in accordance with IFRS. After these remarks, Jean Jacques and I will be happy to answer your questions.
Before I begin, I would remind you that any information to be discussed on the network is forward looking, it's subject to important risks and uncertainties that could cause actual results to differ materially from either referring to the Safe Harbor statement included in our press release. Turning now to yesterday evening's announcement. Hopefully, you will have the chance to read our release, which is issued in both French and English. As always, it is available on LVMH's website, www.alvmh.com, as are the slides we're using to guide today's discussion. We'll start with the 1st slide, Slide number 1, which will be the key revenue highlights for our, of course, results.
We see Q1 as a good start to the year in the context of a challenging and unstable environment. We did a 3% organic revenue growth in the U. S, Europe and Japan, while experiencing volatile trends in the rest of Asia. Looking at the business groups, we saw continued creative momentum at Louis Vuitton and a concentration of our new product lines at the other fashion brands, particularly those based in the U. S.
Within our Wines and Spirits business, champagne showed strength in Europe, and cognac continued its momentum in the U. S. While gradually recovering in China. The Malo Platinum Cosmetics business, Patol 16 Bureau, was the highlight, delivering an exceptional performance. In Watches and Jewelry, TAG Heuer is successfully refocusing its strategy, and the jewelry brand demonstrated robust performance during the quarter.
And finally, within selected distribution, DFS is affected by the environment in Hong Kong and Macau, while Sephora continued to build on its very strong momentum. And for the Q3, turning to Slide 2, total revenue rose 4% on a reported basis to €8,600,000,000 from €8,320,000,000 in the prior year. This includes, as I mentioned, a 3% rise in organic revenue and a 1% structure increase from the integration of the facility set on the Guardian other activities. While there are some currency impacts on the business group level, the overall impact on the group level was small. Turning to revenue by region.
We continue to have a well balanced revenue mix across geographies. As you can see on the map on Slide 3, in euro terms, Asia, including Japan, represented 77% of revenue for the Q1. A quarter was a little bit boosted by Chinese New Year in that region. Europe, including France, accounted for 26%. The U.
S, including Hawaii, represented 25% and the remaining 12% related to revenue from other markets. In terms of change relative to last year's Q3 organic revenue rose on a geographical basis in euro terms in both U. S. And Japan. Europe also delivered growth in the 7% really 6% sorry in U.
S. And Japan. Europe also delivered the growth with a 7% increase, while the rest of Asia saw a 2% decline. So similar trends to what we saw in Q4, slightly higher growth in Europe and U. S.
Being offset by Japan, where the yen strength at the end of January had an impact on average flows. Let's look more closely at each business, starting with Wines and Spirits. Organic revenue grew 6% with the total revenue rising to €1,830,000,000 from €1,000,000 in the Q1 of last year. On a reported basis, this group was up 4% after taking into account a 2% negative currency impact. If we break this down by champagne and wines, in champagne and wine grew revenue grew 3% on an organic basis and with a negative 2% currency impact at €201,000,000 in the Q3 of this year, compared to 397 €1,000,000 in the year prior.
Revenue for cognac and spirits saw a 7% increase in organic growth after a negative €0.01 currency impact to reach €633,000,000 compared to €595,000,000 in the year ago Q3. Looking now at champagne and wine. Volumes in the champagne business were down 1%. However, in organic revenue terms, we saw growth in Europe partially offset the impact of the performance in the U. S, primarily due to the timing of price increases.
The States and Wines reported good organic growth driven by positive pricing effects. In cognac and spirits, Hennessy volumes were up 8% for the Q1, reflecting continued strong momentum in the U. S. We're also encouraged to see gradual recovery of cognac in China with shutout trends in February looking healthy. However, as we have seen in the past, it is always dangerous to extrapolate the Q3 trends.
So first of the year in Grammarangi demonstrated sustained growth. Moving on to Fashion and Leather Goods, Slide 7. This business group was flat for the quarter, both on a reported and organic basis. Revenue remained basically steady at €2,970,000,000 versus €2,900,000,000 in the year ago period. To give you some color on fashion and leather goods, this group experienced continued growth in Europe, except France, where popular tourist destinations saw a marked decline in traffic in the quarter.
Japan continued to grow and be at lower rates. The U. S. Continued to be impacted by the ongoing changes at our U. S.
Plants. And finally, the rest of Asia remained a challenging region even though there were some signs of improvements. At Louis Vuitton, the brand continued its creative momentum with its new models well received during the recent shows and continued success of its historic celebrity designs. In addition, the brand's new locksmith and jewelry and precious watch collection were positively received. Among the other fashion brands, Fendi showed solid performance in its leather and ready to wear lines.
Arapyama continued its focus on exceptional quality products and Celine demonstrated good momentum due to the successful developments of new segments including the show with the small evidence. The discontinuation of the TK NYC and TK jeans lines at Onkarran at the end of last year as well as the more recent label changes that non taken had a negative impact of around 2% on this business group growth. For our Plastics of May business group, Slide 9. Revenue reached 1,210,000,000 compared to 1,930,000,000 in the Q1 of 2015. This reflected an organic revenue increase of 9%, dollars offset by a 2% currency impact in revenue growth for the quarter to 7% on a reported basis.
I should note that the 2015 figures have been adjusted to take into account the reclassification of the Kendo Cosmetics Company from selective retraining, food, perfumes and cosmetics. The performance of this business group, which is Slide 10 now, is boosted by the strong momentum of 13% mix up in Europe and in the U. S. Christy Joule's new Cevage fragrance continued its success, and the new campaign of the iconic G'adore fragrance through the launch of La Nivelle au Lanier has been well received. There has also been a positive response to the new Poison Girl fragrance and good performance in the Duo Addict makeup line.
So in the quarter, Guerra launched Lapisit's Wodenois makeup line, and its Orkadei Imperial skincare line showed solid progress into the collaboration of its 10 year anniversary. Gala will collect and discuss 5 7 shops on the road in Santonai in Paris. Carpon as you know, sees continued progress in its makeup lines and rapid progress. Now looking at our watches and jewelry business, Slide 11. Revenue industry was €734,000,000 compared to €723,000,000 in Q3 last year, growing 7% in the period on both an organic and reported basis.
The growth this quarter in Nottingham and Jewelry has essentially been driven by progressive recovery at Tag Heuer and continued growth in jewelry. Whilst the successful repositioning last year, TAG Heuer's connected watches attracting a young clientele and its core offering the attending momentum. It is expected to continue into the Q2 given the success of the 1,000 world watch There's also a solid performance in jewelry with all brands contributing to this growth. And there is success of new D01 collection and its renovated London Bond Street flagship deal, together with share buybacks, particularly in Asia, are among the highlights in the quarter. The selective weekend increases up 4% on an organic and reported basis to 2.7 €5,000,000,000 from €2,650,000,000 in year over year.
There was a truly a sale of 2 very different themes. Sephora, which is Slide 14, delivered very solid organic revenue growth overall and a double digit comparable store increase in North America and the Middle East as well as in Russia and Southeast Asia. In addition, the brand continued its robust online sales growth. During the quarter, Sephora continued to expand its store network, opening locations in Europe, Asia and the U. S.
And launched e commerce in Southeast Asia. The DFS was impacted by the continued challenging market environment in Hong Kong and Macau, but showed good performance in Japan where it benefited from Chinese tourism. It also opened a new tea gallery in Siem Reap in Cambodia in March. Overall, our relationship with a good performance against a challenging economic backdrop. All our businesses contributed to growth in the Q3 with the exception of fashion and leather goods, which was affected by lower tourist flows in France
and the discontinuation of 7 products lines.
The group continued to benefit from both its businesses both its business and geographic diversity. And going forward, we're continuing to focus on innovation and creating high quality products while selectively expanding our store network as we pursue objectives of increasing our leadership position in the global luxury goods market. Thank you. And with that, we'll take any questions you might have. Laurent, please could you open the line?
And we have the first question from Mr. David Damaya from Fiji. Please go ahead, sir.
Hello. Hi, everyone. Two questions, please, on NV, just to better understand the drivers beyond the slowdown in Q1. Have you seen a renewed weakness of the decodulation in your main markets, Europe, U. S.
And China? Or the slowdown we've had in Q1 is only second to fall after this funding? And if it's the case, can you share
with us the current rate of
tourists coming at the M and A total sales, please, especially
in Europe? And I have a
second question on pricing. It seems that you didn't implemented any price increase so far. Are you planning something for the rest of this year, maybe some price increases in Europe to reduce the gap versus China, for example?
So on the weakness or potential weakness in local markets, the answer is definitely no. What we've seen in the U. S, in Europe and obviously, we've seen in Asia, which is true as well, in China is a fairly strong resilience in some areas like Europe, significant growth of local customers. So basically, the slowdown, the limited slowdown that we've seen in Q1 come smoothly and this is not a surprise, unfortunately for all of us, come mostly from the traffic flows and the slowdown in traffic flows, particularly from the eastern part of the world into the western part of the world. The share of tourists at Victor, I think it's about 65% to 67% to 57% higher in some areas like Europe, where it's an 80% expense overall of 50% and some areas like the U.
S. And Japan, although as far as Japan is concerned, the share of choice is growing. It's in other areas, the share of choice is still below the open percent. The price increase, we are not going to disclose the price policy. You're absolutely right in saying that we have not increased in the main areas.
We have not improved our prices. We see a few technical pricing issues in areas where currencies have been particularly weak, which has otherwise been enduring change. We've gone through doubts that we have no plans, no particular plan to announce here.
So we have another question from Mr. Warwick Martinez from Exane. Please go ahead. A question about the drag from the discontinuation of the of some U. S.
Lines in the quarter. Firstly, did you see a sense of drag in Q4? Or what does the activity really begin to hit Q1? And if so, do you accept the same sort of quantum of drag over the next couple of quarters, please?
Well, particularly at Bonnakhrland where we discontinued both the KYC and the KYC, We started doing that about December last year. So the drag in Q4 was extremely limited last year. It is much more significant in Q1 of this year and obviously the impact will last to the distribution of the slides end of the year. As far as Q1 is concerned, we estimate the impact of the division altogether on the Quick Load, the Fashion and Lever Group of Business was about 2%. So absent this continuation of lines, it goes to the we have been 2% instead of 0%.
So it's quite significant and we're prevailing in most of the year.
And presumably in Q3, a little bit more than other quarters because it's more of a wholesale quarter. Is that fair?
Yes. But I mean, if you look at it
and you can take in the global context
of Fashion and Mela, it could be some differences with your talking about the digital features. So it's a bit difficult to take it, but you're really right, yes.
Sure. And if I may, one more. Can you comment also on cognac price rises during the quarter, if you made any in
Q1? No, we didn't. We will probably do something in Q2, but not in Q1.
We have another question from Hermine De Bensman from Raymond James.
Hi, good afternoon. A few questions for me, please. The first one, in question on Jesuits, can you provide more granularity on this quarter regarding the performance month after month? Are you seeing an improvement in March February, especially in France? My second question is on cognac.
Can you give a bit more details regarding the Chinese New Year? I think you mentioned during the presentation that the sellout trends were in, of course, healthy? And lastly, in Washington January, can you confirm that January is growing double digits? Or do you expect Polari to maintain such a nice pace of growth?
Well, the first answer
to my question is no. We are I mean, the tariff cut off in November, it took a while before the impact would sell. But once it sells, we know that it's going to take a few additional amounts to normalize. As far as Chinese New Year for cognac is concerned, we are quite happy with the sellout numbers for Chinese New Year. We that the Chinese New Year started to change, but nevertheless, altogether, we ended with pretty good performance.
As far as the asset is concerned, we did positive around the strategic positions for changing the year. And as far as this was concerned, better
than that. I don't know whether
we can extrapolate this, but the start of the year for this year is record. As far as working jewelry and jewelry is concerned, as you know, we don't disclose precise features on brands, and I don't know where you get the yield that Bouygues visibility. We did much better with Bouygues in Q1 than in Q4. Q4, as you remember, had a marked slowdown for the brand last year. Q1 was much better, particularly strong with Duy, a little bit less so with Zmocha, but we know
Thank you.
We have a question from Lucas Solca from Exane Pernod Ricard. I was wondering whether you could give us
a sense of demand by internationals because irrespective of where this demand is emerging and I understand that various effects had an impact to Europe, a negative impact to Europe.
So I
wonder what you're seeing on the main nationalities, especially the Chinese and the Americans and the domestic European, if you could give us a little better granularity on that one. Secondly, you are in position on 2 brands within Fashion and that's good. As you could say, you can look at Telecom and Mark Jacobs. I wonder what the prospects would be for them to reach a new normal. And when you anticipate that it will happen, it's something that we could
see in 2016 or whether it will take
longer. And last but not least, there seems to be strong momentum in some of your watches. France, I was wondering whether you could help us understand the different dynamics in that cash in that division between jewelry and watches. Thank you very much indeed.
Thank you, Ed, Ilkka. So demand by nationality,
no dramatic changes compared to Q4. We saw Chinese demand being flattish, because a bit more positive in Q4 and it was flattish in Q1, both at home and as far as towards the markets are concerned, whereas we have significant spread between the 2 last year. So that's probably more than we think. It's more balanced as opposed to what we as opposed to
what we had last year.
As far as American customers are concerned, it's more or less the same trend as the one we had last year. For European customers, it's more complicated to measure and I'm obviously answering on this one, because it's the only brand where we can measure with some accuracy. Even today, it's quite complicated to measure. We've seen some pretty strong numbers in the UK, even in France, besides the drop in the domestic market has not happened at the end of last year. So we know we see even in Japan, So we're seeing domestic trend there being reasonably strong in Q1.
The question on the contemporary brand on
DSNY and non Jacobs and the prospect for are new normal. It's obviously a very difficult question. The only thing I can say is that, I would just say, it's one is that as far as 16 is concerned, we are doing according to our expectations. I mean, collection after collection, we're seeing the same and we see volume of business being in line with Bouchet or even exceeding it. So it's quite encouraging.
This being said, that type of turnaround doesn't take precedence or to quarters. I mean, if you're stronger than that, As far as 2016 is concerned, we more or less know with the bookings what we are going to do. So I can quantify this as a start of a turnaround because it's done according to our plans. Maybe you are if you can see our numbers will be lower than last year, but it's a different maybe a different perspective on that. But I don't think we will see enough improvement before 2017 anyway.
As far as watching and doing is concerned, as you said, I mean, the momentum for watches and putting in product volume is quite strong. It's not it didn't start yesterday. I mean, it's some improvement in the offer that we have started a few years a couple of years ago. So we are actually getting the benefit of the repositioning, the lowering of prices of the brand. Even the U.
S. Market, which was quite difficult, which has been quite difficult for some years, is improving now. So we are pretty pleased with the turnaround of the quarter. There is some way to go. That was okay with as far as the oil expansion of the portfolio business unlike other brands.
So it's very encouraging. As far as the deliveries concerned, I said I made a few comments already, and the jewelry business is still doing very well. And I'm talking about basically, so that the Tier 1 introduction, obviously, what we have done in the Q1 of the year are working extremely well. The water treatment is still particularly the female water treatment is still a little bit under pressure as it was at the end of the year. There's another TWL, but the lines are pretty muted.
So it's not like a customer from that or grow. I mean, we register significant growth for the brand, but definitely a big contrast between the
Understood. Thank you very much indeed, Robert. We have another question from Mr. Antoine Belf from Please go ahead, sir.
Yes. Hi.
It's Antoine Belch, HSBC. Three questions.
First of all, I'd like to come back
on your comment about the impact of the non LV brand on Fashion and Leather. I appreciate the comment, especially on the U. S. Line. Presumably, I'd love around vaccine except for what we're doing quite well.
And what I'm trying to get at is, is the very top of the dividend as a whole has been minus 3% if
we compare Q1 'sixteen versus Q4 'fifteen.
Is it fair to say that the delta has been more subdued further in the year? My second question is regarding how we should think about the basis of the current sales efficiency level in Q2.
I think there is a bit of a
debate amongst investors and people are, I think, quite afraid by the fact that last year, plus 1 in Q1 and plus 10 in Q2. And for some degree, it's just sort of narrowing the previous year, because of the price increase that's happened in April 2014. Actually, should are you would you advise us to be cautious as well because you had a big benefit from the tourist flow, especially in Europe in Q2? And if that's the case, are you taking a more cautious attitude on cost of the period at Vuitton? And finally, on champagne, the Q1 seems to have been impacted by a bit of timing difference for volumes.
So are you still confident about the full year? And champagne has given us steady business over the last 2 years. So basically, are you expecting a cash up effect later in the year in champagne? Thank you.
Thank you, Antoine, for your 2 questions. As far as LV is concerned, if I get you well, I mean, want me to give you the difference in the growth of Rovi in Q4 and Q1, which obviously I'm not related to the Q2. There was a little bit of slowdown as we I mean, there is Aerie, which is mostly coming from Paris. I would say we have double digit down in Paris with with Vitol. No surprise to that.
Paris is an important place to do business for Vitol. We may have recovered a little bit of this outside France, although it's not obvious because most tourists would not only visit France, but they usually visit other countries as well. So the impact is already felt on the most countries basis. But there is also a slowdown of detail. So that's all I can say on this at this point in time.
The basis for comparison in Q2, I mean, you know the numbers. So if you look at the only way to answer your question is to use numbers and which has the benefit of erasing the impact of the VAT changes in 2014, which creates yet a low growth environment in Q1 2015 and high growth environment in Q2 2015 versus the stores in comparison base. So look over 2 years, it's more or less the same
type of
growth. So I don't think we should know that too much about all that. I mean, what is important as far as we are concerned is to look forward and to try to benefit from to try to manage the business with the current the business with the current environment as opposed to really looking at the comparison date and what happened last year, whether there was a big increase impact in sales in those existing numbers and so on. As far as campaign is concerned, yes, there is a timing issue in comparison date that last year we had a price increase in late March early April. So as always, when this happens, certainly in the U.
S, there is a big pickup in volumes in both Sweden and Celaus before the price increase. We don't do that this year. Maybe there will be price increase later on in the year. It's not decided yet. So the comparison rate was a bit affected.
Hence, the flat issue of slightly negative volumes for champagne. We remain pretty optimistic for the rest of the year for champagne. The European business is doing okay. The Japanese business is also doing okay. And the U.
S. Business will certainly normalize after this strong comparison base in Q1. It was normalized for the rest of the year. So we have pretty good share of our shipping business.
Okay. We have another question from Mr. Thomas Chaudet from Citigroup. Please go ahead, sir.
Sir. Good afternoon, Chris. I have three questions, please.
The first one, at Vuitton, you seem quite happy about the pricing, the product has been up to production after several years of reengineering and such will change. Can you perhaps give us some qualitative comments on what kind of the categories did well between the small leather goods within more affordable price points, the fast Cambroft bag, I think you mentioned that it very well. And the higher end leather bags on which you communicated a lot in the past, that you've seen differences in price points, principal differences. Secondly, on Japan, I'm just trying to
understand what happened in Q1. I mean,
I know the 2 year comparative was tough
because of the spike ahead of the VINs increase
2 years ago, but the 1 year comp wasn't. So are you seeing an underlying demand slowdown with the local clientele? Are you seeing a moderation in tourist demand for Chinese given the stronger Japanese
yen? We saw
a slightly weaker tourist trend into Japan
from Chinese versus Germany, for instance.
And thirdly, on PFS Hong Kong, can you comment perhaps on traffic versus average basket? Are you still seeing a less sophisticated shopper into this channel and then you've entered an outlook for that business? But when
are you thinking of starting
the discussion about renewal of the ongoing effort? And what would be a trigger for you to stay
there other than the rents reduction?
Okay. Thank you, Thomas. So on the growth differences in different price points that we do, I will
not go to detail. The only thing I can
tell you is that if you look at the product range for Levigates or irrespective of Canvas, leather goods, soft, etcetera. Which is a very important category for us. And it's really much better because we're definitely the same in Q3 and Q4. A trend. So definitely, the small negative portfolio of Switzerland don't rely on 3 different models.
We have a lot of products in the specific delivery in the stores. So there
are pluses and minuses.
So it's very difficult for me to give you a trend in that apart from really the consistent outperformance of smaller
If I may, just as
a follow-up, sorry, on small leather goods, which are, if I
understand correctly, mainly Canvas generally and quite affordable price points. Is there a way for you to attract new type of customers to the brand? Or is it the trading down from your existing clientele that is interesting to meet in small dynamic categories like wallet, purse, etcetera? Just trying to see what the strategy behind that.
The strategy is to have a range of affordable products with high attractiveness. So putting down
is not something we have in mind. And bear in
mind that for the price of the way at the future, you could buy it back at some other brands. So it's affordable, it's high quality, it's fabulous design, it's quality, etcetera. So it's high value and that's what we are trying to develop. With small exhibits. It's been there forever.
But with I think new creativity in design and products and it was well.
So that's the strategy behind it. It's not putting down.
It's not anything like that. But any expression of the brand that we do should be convincing and this is particularly convincing the profit, the reaction from the customer base. So your question on Japan and China, I mean, in Japan, we had, as I said, flattish domestic in Q1. The tourist flows were still growing, obviously, not necessarily at the same approach rate as the one we had before. Because when you look at only 2 years back, I mean, this trend was non existent.
So obviously, you get triple digit growth for a while and then it goes down. But you can certainly see the growth of opportunistic business in Japan. You're right in saying that the Japanese yen became stronger towards the end of the quarter. It's a bit early
And finally, your question on DSS.
It's exactly the same. I mean, we see traffic alright and that it's declining. So that's been the situation for quite some time in Hong Kong and we see no signs of change in the future. As far as the airport is concerned, the only thing I would say is that the maturity of the expiry of the current concession is 2017.
We have another question from Mr. Fred Spares from UBS. Please go ahead, sir. Hi, good afternoon. Two questions for me, please.
Firstly, within Vuitton Handbags, you've excluded small leather goods. Could you add some color around how much the handbag growth driven by higher ASPs compared to volumes? Secondly, yesterday, we heard from FADA on their conference call that they're looking to bring in with a harmonized pricing range of less than 10% between regions. I was just interested to get your data set on how you feel about your current production price gaps.
Well, on your first question, the day our competitors will provide us with the same information, I guarantee you that they would answer the question. But unfortunately, I will not comment on this. It is obviously way too sensitive from the commercial viewpoint. I'm sorry.
As far as price trend
is concerned and the 10% price trend on the worldwide fleet is announced or commented, I would say, yesterday. It's I'm not really in the position to comment on competitors' decision or plans. The only thing I would say is that as far as we are concerned, we think that the 10% global range is too narrow to cover differences in between countries and the countries where you have no taxes at all in the countries in which you have a lot
of taxes like China
for instance, duty, consumption tax, etcetera, etcetera. So having a 10% price range, if the price range applies to prices available to clients, I mean not to net prices to gross prices available to clients in stores. But it's obviously, in my view, not predictable, because I don't have to
comment.
So we have a question from Madam Catherine Rolland from Kepler Cheuvreux. Please go ahead.
Yes. Good afternoon. Catherine Roland with Kepler Cheuvreux. I had two questions, actually. First of all, regarding written sales to Chinese customers, I understood that they were flattish in Q1, but I didn't get the sales trend to U.
S. Customers. So could you just remind us what was the sales trend? And my second question was about the different net organic growth of around 7% in Q1. Could you give us more color about the split between the preference that you had in the U.
S. And the one that you had in Mainland China, please?
Okay. So you're accepting a single digit. And sorry, I was more or less in line with the trend that we've seen. We ended the quarter with a very low level of soft with our distributors. So we'll see how we manage the replenishment of this in the months and quarters to come.
Okay. And about sales trend, selling sales trend in many China, do you give any color?
Well, it's quite positive for if so, let's talk for the SOP and the SOP last year. We still had large, very substantial numbers of big outlets in on trade that we closed March April last year because we were unprofitable. So despite the volumes were already down last year in China, we still had some unprofitable business that we decided to discontinue from March, April onwards last year. So it's presently a bit insufferable in Q1 that will normalize as of Q2, so selling was slightly down in China, and I commented already in sell out.
Okay. And just to come back to the device customers churning Q1, was there any change in churn versus Q4? Did you see any slight deceleration from less customers?
Yes. So maybe but nothing significant enough to go into trend and to comment further. Thank you.
Okay. Thank you very much. Thank you, Christian.
So we have another question from Mr. Oliver Chen from Cowen. Please go ahead, sir.
Hi. This is Courtney Wilson on for Oliver Chen today. Thanks for taking our question. We just had a question on Sephora in the U. S.
Are you planning on accelerating the store openings in the U.
S? And how do you
feel about the current size of your U. S. Store base?
Well, accelerating thank you for your question. Accelerating, I don't think so. I mean, although the U. S. Market for us is absolutely fantastic and has been absolutely fantastic for private sectors in a row.
We have developed our capacity to keep us to open more stores and to be more efficient in this respect. It's sometimes more is too much and the thing that we're already opening about 20 to 50 stores a year at CXI-four in the U. S. It's a lot. But since a lot of work and it's a lot of multiple mistakes, if you see what I mean by that.
I think we should see that the process of opening the phone and that to manage their store base in the account in the U. S, and we are not asking them to But certainly, of course, many more, particularly if we manage to at different format. So it's pretty early to get more percent on both
Thank you. Best of luck.
Thank you.
Okay. We have another question from Rogerio Ciciroy from RBC Capital Markets. Please go ahead.
Hi. Two questions. First on
the session led in Asia.
I was wondering if you
could comment on sequential trends
you saw in mainland China, Korea and rest of Asia in Q1? And the second, could you give
an idea of about the level
of growth you enjoy in Safra Online? And how much online accounts for Sephora today?
You don't see the exact answers on the second question. You know that we don't competition viewpoint. So I will not comment. As far as Mainland China and the rest of Asia is concerned,
I didn't hear
at the beginning of the question, but I suspect it's for Fashion and Leather. We've seen growth rate being more flat there for Asia in the first part of the year. So now I mean a little bit better than Asia. Obviously, Hong Kong and Macau are still Prices are particularly favorable there due to the level of the Korean won. So it helps to the business a lot.
Singapore is doing okay. Australia is doing very fine. So basically, we have I think we mentioned in the press release that there is a
Macao and Hong Kong going down
and some positive growth like Japan, Korea, Australia and Singapore to a lesser extent.
Okay. Thank you.
Maybe one last question.
Yes. We have a question from Dan Jannada from Macquarie.
Just last one. Just on indication, maybe a follow-up on the previous one on the performance of ready to wear versus accessories. And then a comment on maybe longer term view. A few times in the past, you had an indication that the growth of Bvlgari is related to brand specific strength and also the industry as you mentioned at the division outperform. Obviously, you're still trying both because of the 2 years on performance with that innovation and mix.
Hand corner, that would be appreciated.
Growth in a brand like the new brand, it's a strong from a fairly long history of product introduction and brand management with the brand under our management and quickness on this management. The brand is very strong. I think we made it clearer for the technical customers, definitely do the brand and the product introduction, be it the share, be it the anti lines, etcetera, are extremely strong expression of this growth. And obviously, they found their customers and strong business has been generated.
And check that on top
of that, a little bit of the personalization of the store network. I think in the 6 days, the strengths of top tier of the brand over the last 2 to 4 years. It's an ongoing process. I mean, it's a never ending process, I would say. We still have to improve the brand.
We still have to improve the network and to launch exciting product and to do so.
Thank you. And the ready to have a successor, please?
Okay. Thanks.
Maybe one other or couple of questions.
Yes. We have another question from Haneda Jason from Redburn.
I just wanted to clarify this 2% comment. I mean, is it right that, that implies €250,000,000 of sales on a plan that's getting rid of? Or is there actually a timing thing that's more impact Q1?
I mean, you're related to Q1?
Yes. So if I annualized 2% of the last year's session, other good sales, it implies 1050,000,000. So you're giving up €250,000,000 of sales on the plan. Is that right?
We are closing the keys in the C business. And your assumption on the on the amount of business that you
are holding is right.
Okay. And just on rationality, So you said the Chinese demand is flattish, American demand is mid single digit positive, European demand is strong, trans low single digit growth. So I was just wondering, where is that deal weak by nationality?
Growth
that we had at least in Q1.
So it's nothing consistent in my year without it. It's minuses.
Okay. We have another question from Celine Sheribard from Natixis. Please go ahead.
Yes. Good afternoon. I have one additional question and that is in particular. In return, do you expect any specific launch of products for Q2 in order to fuel the group?
Will be And more than
Thank you.
That concludes the conference call. So I look forward to discussing with you H1 members in the Q and A. Thank you, and have a nice day.
Ladies and gentlemen, this concludes the conference call. Thank you all for your participation. You may now disconnect.