Well, ladies and gentlemen, good morning. We'd like to wish you a warm welcome to this annual general meeting. I'd like to declare the meeting open and suggest that we appoint as teller Mr. Nicolas Bazire and Mr. Florent Ollivier, in attendance representing the greatest number of votes, and to appoint as secretary Mr. Bernard Kuhn, Group Legal Director. The quorum has been reached because the attendance sheet has been drawn up, and we will give you later on the precise number of shares represented at this meeting. All the legal documents required for the holding of this meeting made available to all shareholders. I would also inform you that an officer of the court is in attendance to ensure the smooth functioning of our meeting. We can now begin the order of the day, which is to review and approve the results in 2016.
Before handing over to Mr. Guiony, who will review the figures in details, let me just say that 2016 has been an excellent year, with remarkable results. A record year in terms of revenue, profit from recurring operations, and free cash flow. The group is indeed well-positioned at the end of 2016 to address a year of 2017, perhaps slightly different from 2016, but more about that in due course. You have the figures shown here. I now turn to Jean-Jacques Guiony for a detailed review of the financials.
Merci. Thank you. Good morning, ladies and gentlemen. Let's go through the figures of 2016, starting with the revenue. As you can see on the slide, we have a record level, EUR 37.6 billion, up 5% compared to 2015. This is organic growth, not including Forex effects to the tune of 6%, and a slight negative Forex effect of -1%. Usually, there's much more swing, 1% is barely significant, so keep that in mind, 6%. You also have to remember that this was staggered in the year because in the first half of the year, on the left-hand side, you had +4%, but the second half, +7%. There was a stepping up of growth in the year. This was confirmed at the beginning of 2017.
You can see it on the next slide because we announced overall 15% growth in revenue for Q1, 13% organic with a 3% effect of, well, Forex effects, mostly due to the yen. The 13% organic growth, most, if not all of our brands were up. Our main businesses for which we report have enjoyed double-digit growth, especially fashion and leather goods and wines and spirits at 13% and 15%-- I beg your pardon, both of them 15% for Q1. This trend is, of course, very positive indeed. We had a favorable comparison basis because last year we were only 3% up, it would be unreasonable to extrapolate this to the end of the year. Now then, back to 2016 on the distribution of revenue by region, not much change.
About a quarter in the U.S., a quarter in Europe, and a quarter in Asia, not including Japan and the rest, 7% in Japan, and the main areas, South America and the Middle East and Oceania for the balance. If still on a geographic region basis, organic growth, you had 6% last year. In the U.S., we're close on at 7%. In Europe, likewise, 7%, which is a bit of a surprise because Europe, especially at the beginning of the year, was hit, as it were, by the effects of terrorist attacks, especially in France. 5% in Asia. This was stable, only negative in previous years, so a rebound in Asia. Japan, however, because of the revaluation of the yen, was down -3%. What you have Q4, the last quarter of 2016, was much better than the rest of the year.
Improvement in all regions except Japan on the last part of the year. If you look at the various businesses now, same observation. Overall growth, then again, 6%. We have rather homogeneous figures. Wines and spirits, 7%. Fashion and leather goods, 4%. If you look at the first half and the second half, the first half was almost nil and second half almost 8%, so a remarkable stepping up in the second half of the year. Perfumes and cosmetics and Watches and jewelry at 8% and 5%, respectively. These numbers are much better than the competition, at least those that do provide numbers. Selective retailing, plus 8%, good number. This concealed disparities between travel retail. That was challenging last year because of volatile Asian customers. By contrast, Sephora performed extremely well. I'll get back to that later on throughout the year.
Let's look at the income statement. 5% growth in revenue. This is the number in EUR, not organic. Margin at 63.5%, so up 50 basis points compared to last year. MSC is same, 6% both for marketing or sales expenses, up 6% both of them. G&A grew a bit faster. We want to be cautious, and there were lots of provisions, mostly in G&A, and that's why you have a greater increase on G&A rather than MSCs. Of course, our PRO, profit from recurring operations, 6%, above 7 billion for the first time. This is a record high for a PRO. Other operating income and expenses, mostly depreciation of intangible assets. This is a charge, but it's only EUR 122 compared to EUR 220 last year. Financial income, about the same. Taxes are up, unfortunately, not in terms of percentage, but in absolute numbers.
Minority interest, slightly down because, DFS struggled a bit last year. We have a minority interest, and that is why you have less there. In any case, all in all, the group shared net profit almost EUR 4 billion, EUR 3.981 billion, up 11% compared to last year. About the PRO, profit from recurring operations, main indicator then, broken down as follows on the slide that you have for the various business groups. The highlight for both the Wines and spirits and Fashion and leather goods are two main businesses and with the highest margins, almost 30% on revenue, up 10% both. Better than the growth of sales themselves. Regarding Perfumes and cosmetics, about 5% in line with revenue. Likewise for Watches and jewelry. Watches and jewelry, by the way, this consolidates the growth in 2015, which was 75%, which was huge.
Selective Retailing is down, not because of Sephora, which had an outstanding year, but because of DFS. If you look at the financial structure here, not much change. You can see that all in all, we have about EUR 60 billion in assets. About half of this is in equity, and then some non-current assets, some increase in inventories because of more activity. There is credit lines, undrawn credit lines from banks, about EUR 3 billion. Should we have any cash situation, we could always use that if necessary. If you look at net debt and cash flow. Cash flow in light blue. Available cash flow or free cash flow is investment minus variation in working capital requirements. Having paid for our growth, we are almost at EUR 4 billion, very much like our net income, EUR 3.974 billion exactly. Cash flow is not all used for reducing debt.
A significant portion to the, well, EUR 2 billion almost for dividends. I'll say a word about that on the next slide. Dividends, some acquisitions, some disposals, all in all, cash flow minus dividends and M&As, made it possible to cut debt down by EUR 1 billion. We were at EUR 4.2 billion down to EUR 3.2 billion in debt. About 12% of equity, a very low level of debt to equity. A very good performance. By the way, the acquisition of Rimowa last year in Germany, was only done legally in January 2017. This brings about EUR 650 million debt for Rimowa. Not in that number, but it doesn't change much to the overall picture. The dividend. We will be suggesting a EUR 4 dividend per share, up 13% compared to last year. Net income was up 11%, the growth in dividend is higher than that of net income.
We paid an interim dividend of EUR 1.4 in December, the balance, EUR 2.6, will be, I believe, paid out at the end of next week. Over a five-year period, you have the dividend over five years, you can see that it's been growing 9% a year. In line with the trend of the past 25 years, it was up 10% on average. We were up this year, and in line with the trend for the rest of the time. Thank you.
As we have been doing traditionally for a number of years. We decided to consult several thousand of our shareholders to ask them what questions they would like to see addressed at this meeting. We're now going to summarize them in the following clip. As Jean-Jacques Guiony indicated, the year 2016 was a record year in spite of an economic backdrop that got off to a bad start after the terror attacks that struck Europe and led to a decline in tourists and an overall drop in business. The situation improved over the second part of the year, where we noted more generally an upturn in the global economy, notably in the United States, and a recovery for many of our products, wines and spirits in China. Year 2016, that got off to a challenging start, but ended on a far more dynamic note.
Let me say that this situation partly accounts, as Jean-Jacques Guiony indicated, for the results of the first part of the year. I expect a reverse situation in 2017 as compared to 2016, a relatively easy start to the year, but a more challenging second half of the year given higher levels of comparison. 2016 was an excellent year. I would just like to review the various business sectors that all fared well in 2016. Wines and spirits recorded an excellent year, strong growth in the U.S., and as I indicated, a rebound in China. The difficult period in China is coming to an end, and we were able to record growth levels in the market that for several years was impacted by the slowdown in consumption levels following very strict discipline on spending in restaurants for key clients, et cetera.
We recorded an increase of 3% in Champagne sales and the prestige vintages delivered an excellent performance, notably Dom Pérignon. Moët & Chandon strengthened its leadership in Champagne. Cognac also delivered a record performance, 10% growth in volumes, which is not without posing a number of questions because these volumes are limited. 2017 is off to a strong start, and we are likely to be a little tight in terms of supply for the iconic creations of Cognac Hennessy that illustrates the generation transmission within the same family of master assemblers heading up this activity at Hennessy for many years now.
We, of course, continued to roll out our value creation strategy by seeing as we have done during periods of crisis that we have encountered in the past, but never to lower our prices, but rather to increase them. The image of our products is outstanding for wines and spirits across markets. For fashion and leather goods, Louis Vuitton put in an excellent year with a great deal of creativity. What are the new developments at Vuitton this year? I would mention, first of all, the suitcase created by Marc Newson that obtained considerable success. This very original suitcase is characterized as compared to all other products on the market to have a fully uniform interior, that it has fulfilled its role. A very successful product and excellent for the Vuitton image, connecting it to its roots as a trunk maker. Very successful product.
The Vuitton perfumes launch this year met with considerable success. The Louis Vuitton products, traditional leather goods, fashion, that is now headed up by Nicolas Ghesquière, is continuing to expand, and we can say that Vuitton has, in 2016, obtained excellent results. We have a strategy for Vuitton which involves rather limiting the number of stores to improve existing stores. In 2016, we had the opportunity of inaugurating stores that were renovated. The store in Hong Kong, in particular, very impressive stores that since this renovation, have achieved very satisfactory results. The other brands in fashion and leather goods held up well. Fendi continues to obtain strong growth thanks to innovative products, thanks to its iconic designer from the origin, Karl Lagerfeld, who is providing us with fashion and leather goods products that are very successful.
For the first time, the company has topped EUR 1 billion in revenue. For Loro Piana in 2016, we opened a new store in Avenue Montaigne, an iconic store, a Loro Piana store that is getting off to a good start, very successful. The other fashion stores also recorded good results. Loewe, Berluti. The only shadow is Marc Jacobs. I won't dwell on that, but we just hope that the trend for this brand, that's an iconic brand in the U.S., will improve. I think that with Marc, we found the ways of pushing the business back into profitability. Since we were asked about acquisitions, about M&A in the clip you saw earlier.
We made an interesting acquisition, in 2016, Rimowa, a German company, a leader in luggage of excellence for many years, has received a great many solicitations, but for reasons that I won't expand on here. It's LVMH that was chosen by its owners to become its majority shareholder. We're very pleased to be able to invest in this German company, which really symbolizes the success of German SMEs that brings to the group its first investment in Germany, a company where quality is a foremost concern. This brand, known worldwide, offers great potential. Its products are in large part destined for air travel. When we look at the potential for expanding air travel in the years to come, we can be very confident and if the newly installed management team is up to scratch, that the products will continue to grow and growth and profitability likewise.
So much for that acquisition. Since we were asked about acquisitions, of course, it's not the prime purpose of the group to make acquisitions. The prime purpose, I'll return to it later, is internal growth to grow our brands. If interesting opportunities arise to look at acquisitions, but to do that in reasonable conditions and not to go over the top, that is just to make acquisitions to grow without having a specifically defined rationale that's consistent with our strategy. On perfumes and cosmetics, the group has continued to grow market share in a very competitive sector. Dior shown remarkably with the launch of its iconic brand for men, Sauvage. You probably saw the new ads and this product that was launched at the end of 2015, in 2016 is one of the leaders in many countries, is the leading men's fragrance on the market.
Guerlain is also continuing to make great strides as well as the other smaller brands of the group. What's interesting in this business is the creativity displayed and the fact that we now have a proximity, thanks to its management with Sephora, so we can sense the latest innovations in the market and to see what are the trends that are the most promising in terms of creativity. All this, of course, gives rise to a great many plans that we can return to over the next few years. Sorry to go on listing the various sectors that all performed excellently. In watches and jewelry, we encountered a great deal of success. Bulgari, notably, that delivered performance that outperformed the market with the renewal of its Serpenti line.
You may have saw the small pendants, the small jewels designed for this line that have met with considerable success, as well as a whole set of other products. I have to mention the TAG Heuer Connected Watch, that's a big hit because, of course, we're facing here peers, competitors from other universes. TAG Heuer is the only genuine watch brand that manufactures connected watches. When you're buying a TAG Heuer Connected Watch, you're not buying a computer to put on your watch, you're not buying a mobile phone, but you're buying a genuine watch. There are a number of innovations in the pipeline to develop that still further and to become the leading connected watch brand. Selective retailing also performed well. Sephora has continued to break new records, both in the physical stores and online, thanks to the dynamism of its teams.
I won't recall here the long history of Sephora. I believe I did that last year. That's an interesting history. We're accelerating expansion across a number of countries with the omnichannel system that's now set up. You can order online, pick up the products in-store, return products that you're not satisfied with to the store. All this is driving strong growth. DFS, more challenging because of the situation in China. Chinese are traveling less and the situation in Hong Kong that I won't return to here, but we hope that all that will improve gradually. Let's end 2016 with the incredible success of the exhibition that we put on at the Louis Vuitton Foundation, the Shchukin Collection by a Russian collector, the beginning of the century. 1.2 million visitors. That's an outright record for painting exhibitions held in Paris. That's what we can say to summarize 2016.
Let's now turn to the strategy and outlook for 2017. Let's just take a look at a short film before that. 2017, as I mentioned earlier, is getting off to a start that's pretty much symmetrical, but in the opposite respect to 2016. It's at a time when the results are excellent that we need to be the most attentive, the most vigilant, and the most prudent. Experience has shown that there's nothing worse than complacency in a company that's doing well, and this tends to exert an influence that is both soothing and demotivating. I have to say that at LVMH, we're all paying far more attention than during a period when results might have been more challenging. Of course, the ambient euphoria and the current situation that we're facing is rather deceptive.
I said when we announced our results, that it's pretty surprising in my view that the climate continues to be promising, but it also seems to carry with it major risks. I've rarely seen, since I've been at the head of this wonderful company, a period of 10 years without a major crisis. The last crisis dates back to 2008, so we're nearing the 10th anniversary. Moreover, we're living very surprising times. Interest rates are at an all-time low, zero or even negative, because thanks to our great CFO, we can now borrow at negative rates. That is, that we're paid to borrow, which is all pretty extravagant. Currencies fluctuating against all expectations. The dollar's rising, the euro's declined. Markets are awash with cash. We're prepared to do very silly things. To top it all, share prices never stop rising.
We are in a period that requires a great deal of vigilance. I wouldn't be at all surprised, I can't say when, but if over the next five years, next three, two years, I don't know, we find ourselves facing a pretty severe crisis, because all this money poured into the market, and I hear mention of deregulating banks. We saw what happened last time. We need to be prudent. This prudence should not lead us to be Malthusian. We continue to focus on growth. We need to be prudent all the more so that in this period of crisis, there are opportunities. I won't recall here the opportunity that we seized at the last crisis. I don't want to engage in controversy. Generally, such times offer good opportunities. That's for the midterm. To describe the context, I believe we need to be extremely prudent.
The strategy we're adopting, and here again, at the risk of tiring you, but let me say that is to continue to roll out the strategy that we've adopted for many years. That is, to focus on the values of the group that are creativity and innovation, the search for quality, and motivating our employees through dynamism, mobility, and entrepreneurship. How's that reflected in our business? In terms of innovation and creativity, we will continue to surprise. If we take Louis Vuitton, well, this week we were with Michael and Jeff Koons in this very building in the Louvre Museum, up one floor, where we launched the new Vuitton products designed by Jeff Koons. I'm sure that it's going to be a great success. It's the first time that a man we can consider the most well-known living artist who's decided to collaborate with Louis Vuitton.
The fact that he's chosen Vuitton is no accident. Vuitton is the world's leading brand. This artist whose characteristic is to break down the codes in the artistic sphere. Always has an eye for quality. When he decided to work with us, he was sure that with Louis Vuitton, the products that he was going to design that are quite outstanding. Well, there's no photograph here. You can go and visit them and see them in the stores, of course, when they're there, if they're not all sold out in three weeks time.
We have to manufacture the products and of course prompt some expectations. You'll be able to go and see them, and I'm sure you'll understand and see for your own eyes the level of quality in the works that are reproduced very finely and the quality of the metalwork and the metal parts inserted in the leather goods, almost on a par. Well, not with a work of art. With products that will become, without a doubt, iconic products. As is the case for good wine, it improves with age. You buy it today, wait for 10 years and sell it more expensively. That's what happened in Champagne with Dom Pérignon, the same artist, a product that is now sold far more expensively on the internet. A great deal of innovation at Louis Vuitton. The last fashion show, that was excellent.
TAG Heuer, the new connected watch coming out. Dior, many new products. The care product most recently launched. Hydra Life, very interesting product. The latest fragrance launched by Guerlain, Mon Guerlain, with Angelina Jolie as ambassadress. A new Sephora line that we want to launch for Rihanna. We expect that to be very successful because of the global star status of the artist who will create them with Sephora and millions of followers on the net. A great deal of innovation. We're of course going to be innovating on the manufacturing front. We're opening up two manufacturing plants for Hennessy. We opened a jewelry workshop for Bulgari in Italy. That's for the first part. The second part of our strategy, quality. We will continue to manufacture high-quality products by paying unquestionable and irreproachable attention on the entrepreneurial spirit.
Entrepreneurship, it's a key hallmark of the group that accounts for its success. The group today, for the 10th or 11th year in succession, is the group that attracts the highest number of young graduates. A survey that was published by Le Monde newspaper, which shows its independence, this survey revealed once again that way out in front is LVMH as a great place to work for young people, that accounts for our success. Thanks first and foremostly, thanks to the great set of brands that we make. We can, through entrepreneurships, attract youngsters and who are sure that they can have a great career at LVMH, moving from one business to another, with opportunities to progress, thanks to the entrepreneurial spirit of our teams. We're displaying a great deal of entrepreneurial initiative, notably on the net.
In a few weeks, a few months' time, we will be unveiling a major initiative of multi-brand e-commerce. I can't tell you any more about that because it remains confidential. Let me end with what is of prime importance for us. It's our sustainable commitment and everything we have done for a very long time now because we were the first, I believe, some 25 years ago, to set up an environment division. We were the first to sign the UN compact in 2001. Since that period, we've always devoted great attention to the environmental aspect of our business, with specific objectives on the eco-design of our products, the traceability of our materials, the reduction of the consumption of water and energy, and reducing the waste produced by our stores and workshops, and reducing CO2 emissions.
The success of the carbon fund in 2016, every ton is valued at EUR 15. It's EUR 6.6 million that were invested in 26 projects that reduce our CO2 emissions. We also made great strides in reducing our energy consumption down 14% in our stores. The share of renewables up 19%, a reduction of some 5% of our greenhouse gas emissions. The good economic performance of the group was secured without increasing on the like-for-like basis our energy consumption. All this was a major effort we wish to reward by awarding prizes to the most exemplary stores. We plan to continue to develop eco-design. Several products have been launched following this approach. Here again, I won't go into details. A whole set of products that are eco-designed.
All this allows us to care for our environment. Another aspect of our development is to be very attached to the diversity and professional makeup. We have 38% of key positions that are held by women as compared to back in 2009 where that figure was 26%. We're making strides. We launched the LVMH Connect initiative and we're seeking to sustain the transmission of knowhow of excellence by hiring young people. We created the institution of trades of excellence that trains several hundreds of craftsmen and women through ties with educational institutions. We hire young apprentices who undergo an internship with us and work as part of this training program. The institute, LVMH today offers 15 training courses in various countries including France.
We recently launched the initiative of LVMH next to the foundation in the Bois de Boulogne that will contribute to this training program of artisans as part of the trades of excellence, which will be designed and built from the existing building by Frank Gehry, so that in terms of the aesthetics, that's in full harmony with the foundation building. That's what I wanted to say. We will, of course, be available to take your questions. Before closing, let me congratulate and thank all our executives, senior officers. There are a number who are in attendance today who've contributed to the success of the group and remain very focused on its development as well as the 140,000 employees that explain why we can hold an AGM such as this and offer you a small gift as you leave. Over now to Madame Boily, Statutory Auditor.
Ladies and gentlemen, dear shareholders, good morning. It is my pleasure today to present on behalf of the auditors the reports prepared for your attention. All these reports were made available to you. They are to be found in a registration document, which was handed over here as you entered this room. I will not go through it. I will simply read the excerpts that are put to you through the resolutions. There are seven reports, two on the financial statements, one on regulated party agreements and commitments, and one on capital transactions. First on the consolidated financial statements and the parent company financial statements on pages 226 and 227, and page 200 of the registration document respectively. Our documents took into account the specificities of this group in terms of business activity, organization, accounting rules and internal audits.
These reports are sent out to top management, the board of directors and the audit committee. Regarding the consolidated financial statements, this is done with the auditors working in various parts of the groups. We certified the consolidated and the parent company financial statements without reservations. We also have a report on regulated party agreements and commitments on pages 228 and 229, listing the agreements between the company and executive officers or this company and other companies that have directors in common. These are related parties. There's a special report on the amendment regarding the relationship or the support services provided by Groupe Arnault. The conventions that were approved in previous years and were continued in 2016 are also listed in this selfsame report. Finally, regarding the extraordinary part of the shareholders meeting, we have four special reports on resolutions that may have an effect on the capital stock.
You have this in pages 282 to 296 of the registration document. They are reduction of the capital. They are authorizations to grant share subscription or purchase options, issue ordinary shares and/or marketable securities for employees. You also have marketable securities with retention and/or waiver of Preferential subscription rights. We have no special reports on these operations that are part of operations included or provided in provisions of the Code de commerce. Thank you. Thank you. Now, members of the executive committee may join me up on the stage to take questions that you might have. Ladies and gentlemen, if you have a question, please introduce yourselves first. I can see a question with sign number 5. Hello. I have been a shareholder from day one.
On page 470, I see that in non-current assets, you propose to pay back to Diageo EUR 8 billion at their request in return for their stake in the group. But if we go back to French francs, how will you be able to pay out this sum, which is a lot of money, because it is about 8% of your market value? Well, the probability seems rather low, but Mr. Guiony will tell you about this. Yes, a few details about this EUR 8 billion. The EUR 8 billion on long-term liabilities are all the commitments, that is, the puts against us that some of the minority shareholders can take. So Diageo, of course, the actual amount is less than EUR 8 billion. That's the first point.
The second point is that the financial structure of the group is very comfortable, and should Diageo decide to sell us the 34% they have in Moët Hennessy, and by the way, you will note in the same text that this would include a 20% discount on the fair market value. That is the objective value of Moët Hennessy. So for them, it wouldn't be a very comfortable decision to make, but in that case, our own equity, our own resources would make it easy for us to meet that commitment and pay that bill. Mr. Coulange, I am a representative of individual shareholders. Congratulations for the registration and the voting boxes. That's good news. Could you tell us where we can get a recording of the exceptional concert that was given in Moscow with your wife and son?
Then more to do with the general meeting, why did you sell De Beers Diamond Jewellers? Last week we had the.
Good morning. Welcome to LVMH's 2017 annual general meeting. Thank you for joining us today, both here in our auditorium in Paris, and also for those watching on our webcast.
-French wines meeting the competition of sparkling wines from abroad. What will be your role faced with the competition? What will Christophe Navarre do? What is the connection between perfumemaker Francis Kurkdjian and LVMH?
Thank you for the kind first question. Leave your name to Jean-Jacques Guiony. You will get a DVD of that concert. Regarding the sale of assets, the disposal of assets, including De Beers, that's cleaning up the portfolio. We're looking at businesses which do not seem to have the expected potential, or the profitability is not up to expectations. Indeed, in the case of De Beers, we felt that this was a business where we found no potential, that moreover, the group of which we had a 50% stake, did not own the brand.
In that case, after 10 years or so, the 10 years of hard work did not lead to the expected results. We decided to focus on Bulgari instead, hoping that one day Bulgari shall become the number one jewelry brand worldwide. About the champagne lobby, we have a great brand called Chandon. That brand, it is a sparkling wine, but a French one. It was created by the founders of this house more than 30 years ago in Brazil, the U.S., China, India. We're selling that wine worldwide. This is a great opportunity, and the main thing is to create value. If all Chinese drank half a bottle of champagne a year, that would swallow up the entire production of the region.
It is essential to have such an offer, and indeed, Chandon has created much more value than many small brands of champagne. Regarding Vinexpo, that event on sparkling wines and showing France's presence in the business, I think this is something of a responsibility for us because we are in this business, and it was for us to take leadership in this. We are, of course, facing competition from ProWein in Germany. This is our chance to promote French wine around the world and become, as it were, the ambassadors of French art de vivre. Now, regarding Francis Kurkdjian, we have just purchased a majority stake in that beautiful enterprise, and we're looking forward to great business in the future. Niche perfumes are an outstanding opportunity for us. Thank you. Question number five again. "Hello, good morning, Mr. Arnault. My name is Roger Tran.
I'm an individual shareholder. I have three questions. I would like to thank you for the Shchukin exhibition and congratulations to your chef in Chamonix, who got his third star, the Michelin. Congratulations to him. Louis Vuitton perfume, let me put it this way. I'm looking at the Chinese community here. The one bottle is worth EUR 200. Do you believe that it's only the Chinese community or Chinese tourists that can afford that sort of thing? You were received by Melania Trump prior to Donald Trump's inauguration, and you went to Moscow to play Mozart again. Were you able to reconcile, in a way, in your friendships, both Mr. Putin and Mr. Trump? Finally, the Samaritaine, where do we stand now? Michael, maybe you can say something about the Vuitton perfume. Yes, EUR 200 a bottle.
We believe this is an entry-level price for a Vuitton store. Of course, it is high-end for the general market. This is a rather exceptional item that can, in a way, reconcile both markets. I don't want to tell you about my relations with foreign heads of state. This is the LVMH general meeting. These are, of course, relations with foreign states have an effect on our business. Looking at the Russian economy, I met Mr. Putin repeatedly, and I can tell you that the Russian economy is less challenged than you might think by the drop in oil prices or indeed by the sanctions that have been implemented against Russia. Looking at our Russian customers, of course, when the sanctions came down and when the price of oil came down, these customers were less present. Now they have come back.
Regarding the U.S., there's a rebound in economic growth in the U.S. I don't know whether this is a sustainable trend. It's true that the stock markets went through a stage of euphoria. Now that the interest rates are climbing back up, I suppose that euphoria will calm down. There are intrinsic risks in this situation where interest rates are low and credit is easy. Again, we find something of a bubble or, say, a surprising situation for the stock market. As we speak, the U.S. economy, and as regards our own activity, the U.S. economy is, of course, buoyant and good for us. Regarding the question on Samaritaine, well, we are entering a more controllable stage because we are entering the construction phase that started in 2015. Reopening is scheduled for the second half of 2018, towards the end of 2018. Further questions, yes.
Good morning, sir. My name is Gerard. I represent ANAF, the French Association of Individual Shareholders. In a survey conducted with your shareholders, you indicated a number of issues of concern or of interest. You addressed most of these issues. You have said nothing, it seems to me, about the digital economy and e-commerce. Specifically, I would like to know whether you could tell us whether the group, maybe not on a business-by-business basis, but at least for the group as a whole, how much business is being conducted through e-commerce? Thank you.
Look, I will let Tony handle this. We do not report on amounts or percentages, if only to preserve competitive confidentiality. We are looking to the digital economy, not just e-commerce, by the way, but also the management of our own business. Indeed, communication is very much present on digital media.
Digital business may be a marginal part of the overall picture, but it does put us in touch with key partners, startup companies in France or in the U.S. Mr. Arnault has said a lot. I can confirm now that the digital economy is now part of our strategy because luxury customers are very much connected to the digital world. We find that about 65% of our customers go through the internet, if only to find out more about our products, to know about the brand, or indeed, to buy things online. We have a center of competence. We are investing in digital technologies. About 30% of our capital expenditure has a digital dimension. Regarding e-commerce, that is sales online, we have a number of brands. Sephora and Louis Vuitton are cases in point.
It's not so much a matter of sales, the idea is that we want for our customers to be able to get the same sort of experience online as they get in a store. Question number two. Hello, my name is Yves Degayet. I've been a loyal, longstanding shareholder of this organization. I would like to draw your attention, Mr. Arnault, to the fact that you are considered to be probably the wealthiest man in France. Of course, this is good for you, it is also good for us because, of course, I believe that if you are well-to-do, it's because the share price is healthy, indirectly, we can benefit from your success. That's just a comment. I do have a question about the price of the LVMH share. It's upwards of EUR 200.
Do you intend at any point to divide up, that is to split LVMH shares, to make the share price, in a way, more affordable to the general public? To democratize, I hope you don't find anything shocking about the concept. Splitting a share into half or handing over free shares, that would also bring the share price down. I'm a fervent admirer of democracy, running an organization or running a commercial concern is not at all democratic. If you try to put democracy into that, it will not work. Regarding the share price, it's true, the share price has gone up. It stands at more than EUR 200, makes it expensive, there are companies around the world where an individual share will set you back even more than that, indeed, where the share prices keep going up.
I don't quite see the need today to have this split thing, to have two new shares for the price of one old share. It doesn't seem indispensable. EUR 200 is the price of a bottle of perfume, as Michael pointed out. Lots of people can afford that. Of course, there's an elitist dimension, this is after all, a luxury business, it might make sense for the share price to reflect, in a way, the high standing of our products. Mr. Guiony, regarding free shares, well, if you look mechanically and financially what the giving out of free shares amounts to, it's like increasing the dividend because you maintain the dividend, you increase the number of shares. We saw that the growth of the dividend is one of our priorities. As dividends are indeed growing steadily, there's no need to hand out free shares.
Thank you. Question number one now. Good morning. My name is Claire Lermitte. I am an individual shareholder. I had a question about Grasse. I saw a few pictures in one of the clips, and there are two of us, at least, in the general meeting, along with my daughter, to have a great interest in this town where I believe you have now been for a couple of years. Thank you. Well, yes. We have set foot, as it were, in Grasse, and this is Louis Vuitton and Dior, and maybe Michael, who was very much involved in the building and renovation of this site, can tell you more about this. Yes, you are talking about La Bastide des Fontaines Parfumées. This property had been run down for the past, what, 50 years, right at the heart of Grasse.
This was our opportunity to return to Grasse, because after all, Grasse was the world's capital of glove-making, and you had leather tannery plants in Grasse back in the old days. This is both leather goods and perfumes. The remarkable thing is, together with Claude Martinez of Parfums Dior, we were able to create creation platforms for our perfume makers at the very heart, the very core of this new business, for Louis Vuitton and an older, as it were, tradition for Dior, was revived through this new site. There is a friendly competition between the two brands of the group, and I believe that the products we will be creating in Grasse will be of world standing. Thank you. Question number two?
Hélène Desmarais
Hello. I am a longstanding shareholder and customer. Question about the Chinese market that is being very volatile of late, and I would be interested to know what the group strategy is for this very important market.
The Chinese market is clearly a very significant market. China is ranked second in terms of global economic power. The Chinese population is very significant and traveling more and more. The Chinese market, which having gotten off to a pretty erratic start, is a very competitive market where customers are increasingly knowledgeable and travel far and wide. Our strategy is to have an established presence. It's not to have a very significant number of stores, but very focused and significant stores that allow the Chinese to discover our houses, be it Christian Dior or Louis Vuitton, and the perfumes brands, and to elicit their interest in the history of our companies and everything that they convey in their authenticity.
Initially in China, as was the case in Russia, it was relatively easy for a brand that claimed to be French to set up shop, to advertise and be successful. Now what customers who are becoming exceedingly exacting and demanding is the authenticity behind a brand. That's why we're adopting this strategy, which is perhaps less swift in terms of growth, but does genuinely preserve the ties between the brand, the customers, France, and China, and thereby achieve a long-term vision, which is our goal. For Louis Vuitton, that has been the number one brand in China, we're there since 1991, to have as its goal, and I'm sure we'll achieve that, to remain the leading brand in China, and the highest in terms of image in the eyes of the Chinese customer.
Well, if there are no further questions, Oh, yes, there is one further question over there. Yes. Then we will move to the vote on the resolutions.
In the voting policies, many companies refuse financial authorizations beyond 10% of shares with a ceiling of 32%. Why do you feel the need for that?
Mr. Kuhn, would you like to respond to that technical legal question?
Sorry for disturbing. I'll answer. We systematically use all possibilities offered by law to be pre-authorized by the AGM, the various financial transactions that we might be led to make. This year, we have a significant number of resolutions. It's the year when we renew these authorizations. It's every two years, and this year we're renewing. The idea isn't to use it. The idea is to have that facility available. You know that when we ask shareholders to pre-authorize a number of transactions, we've never availed ourselves of that opportunity, but we'd like us to do that. It's a precautionary principle but doesn't really serve very much. Let's now move to the resolutions. Let me point out that we've reached a quorum with over 81%. First resolution, approval of the parent company financial statements. Please vote. Approved. Resolution number two, approval of the consolidated financial statements. Please vote. Approved.
Resolution number three, approval of related party agreements and commitments. Please vote. Approved. Resolution number four, the dividend. Please vote. Approved. Resolution number five, renewal of Ms. Delphine Arnault's term of office. Please vote. Approved. Well done, Delphine. Resolution number six, renewal of the term of office of Mr. Nicolas Bazire. Please vote. Approved. Well done, Nicolas. Renewal of the term of Mr. Belloni. Please vote. Approved. Well done, Tony. Renewal of the term of Diego Della Valle. Please vote. Well done, Diego. Renewal of the term of Marie-Josée Kravis. Approved. Congratulations, Marie-Josée. Renewal of the term of Marie-Laure Sauty de Chalon, please vote. Approved. Well done, Marie-Laure. Appointment of Pierre Godé as advisory board member, please vote. Approved. Well done, Pierre. Appointment of Albert Frère as advisory board member, please vote. Well done, Albert. Renewal of the term as advisory board member, Paolo Bulgari, please vote. Approved.
Well done, Paolo. Next, opinion on terms of my compensation, please vote. Approved. Opinion on Tony Belloni, please vote. Approved. Resolution number 16, approval of the compensation policy for executive company officers, please vote. Approved. Resolution 17, authorization to be granted to trade in the company shares, please vote. Approved. Resolution 18, delegation to be granted to the board to increase the share capital through capitalization of profit, please vote. Approved. Resolution 19, authorization to be granted to reduce the share capital by retiring shares subsequent to the previous resolution, please vote.
Approved. Resolution 20, delegation of authority to the board to increase share capital, maintaining preferential subscription rights. Approved. Approved. Resolution 21, delegation of authority to the board of directors to increase capital without preferential rights. Approved. Passed. Resolution 22, delegation to the board to increase the capital through private placement without preferential rights. Approved. Resolution passed. Resolution 23, authorization to the board to set the issue price of shares within 10% of the share capital. You can start voting now. Approved. Approved. Resolution 24, delegation to the board to increase the number of securities to be issued in case there is over-subscription. Please vote now. Approved. The resolution is passed. Resolution 25, the delegation to the board to increase the capital share in case of a public exchange offer. Approved. Approved.
Resolution 26, delegation of authority to the board to increase the number of shares to issue new shares as part of contributions in kind. Approved. Approved. Resolution 27, authorization to grant subscription options or share purchases to employees or executive officers. Please vote now. Approved. Approved. Resolution 28, delegation of authority to issue shares in favor of members of the company savings plans. Approved. Approved. Resolution 29, determination of an overall ceiling for capital increases. Please vote now. Approved. Approved. Resolution 30, amendment of the company's bylaws. Please vote now. Approved. Approved. 31st and final resolution, delegation to the board to amend the bylaws in order to ensure compliance with new legal requirements. Approved. Approved. Thank you, ladies and gentlemen.