First of all, let's appoint the tellers, two tellers. The Jean-Goujon Financial Company, represented by Mr. Pierre Gaudet and Mr. Gilles Hennessy. These are the two largest shareholders represented here. I suggest appointing as our Secretary, Mr. Bernard Kuhn, the General Secretary of the group. We need a quorum for deliberations. The quorum I can give you has already been reached. All statutory documents, which I'll list briefly, have been made available to shareholders in the last two weeks. The documents are as follows: our agenda. Firstly, approval of financial statements. Next, approval of related party agreements, assignment of profits, co-opting of a board member, co-opting another board member, non-voting, assignment of the decision on attendance fees, and various powers to be given to the board, as well as competence for said Board of Directors.
This shareholders' meeting, as in previous years, is in line with our policy of openness and transparency in communication with our shareholders. We organized a shareholders' poll. I'll give you the results later, and many of you took part in that. I'd like to hand over now. After recalling the results, 2011 results, I'll be coming back to this in greater detail later. Excellent results. Yet again, it was a great year, a vintage year, 2011. Growth of sales 14%, profit from recurring operations up by 22%, improvement in current operating margin, and net profit going beyond EUR 3 billion for the first time. This is thanks to the various actions undertaken by your group. I'll be asking Jean-Jacques Guiony to go into a little greater detail to walk us through the figures before I then talk to you about more operational points regarding 2011.
[Foreign language]
Good morning. I will present you with a few figures on 2011, starting with slide one. Revenue, EUR 23 billion, up 16% over last year. This increase, as you can see on the screen, is split in three points. Organic growth, excluding currency, 14%. That's the growth in our business. Increase linked to scope effects, that is, consolidation in the second half of Bulgari and Ile de Beauté, Russia, 4%. Negative forex linked to the dollar of 2%. In total, 16% increase. The geographic split of our revenue doesn't change much year on year, but it's important to recall. We note the increase of Asia up two points at the expense of Japan that experienced a mixed year and to a lesser extent, Europe. Still, on the increase by geography, you can see that some quite high growth numbers across geographies, starting with the U.S. Revenue growth up 18%.
It was 17% in 2010. It's not really a turnaround. It's growth on growth. It's a highly significant number. Japan down 1%. You recall the dramatic events of March 2011. On the back of those events, sales had dropped sharply. April, May, 6% down in Japan. We're down 1% over the year, which denotes a considerable rebound capacity of that country. Sales flat across the year. Asia, strong growth engine for our group. A 27% increase across the year, flat across the year. Europe with a commendable figure, 7% growth, driven growth by domestic customers as well as by tourist visitors. Looking at the revenue split and trend by division, you see the 14% on the right of the chart that I referred to earlier. Organic growth is split quite uniformly across divisions, showing figures that are all double-digit or near on double-digit for perfumes and cosmetics.
Wines and spirits up 6% through pricing and mix effects have managed to deliver 10% organic growth across the year. Very good figure for leather, 6% organic growth. Vuitton putting in a fine performance within that number. Watches and jewelry that post the highest group record up 23%, and that doesn't take account of the consolidation of Bulgari. If we include Bulgari, you see that we double our sales and selective retailing up 19% in a sector where it's not typically the type of growth number that we see in our peers. It's quite a remarkable number. In total, 14% revenue growth, as I said earlier on the organic measure. Turning now to the income statement proper, I won't comment on sales. You can see that gross margin growth is faster than our revenues, 65.8%, up 1% over the previous year. Selling expenses up 18%.
That's our resolve both to invest in our distribution networks, but also in brand building, advertising. Admin expenses up 13%. In total, we've been able to grow profit from recurring operations of 22%. It's the key benchmark indicator. 22%, 16% sales growth. That's very commendable. Other income and expenses down. Essentially, amortization of intangibles, not fundamentally significant. Financial expenses change. It was very positive last year in 2010 because of an unrealized profit on the unwinding of the Hermès transaction. That was a one-off. We're back to a far more normal financial expense. Corporate tax pretty much flat in absolute terms. 30% of pre-tax earnings. That's a very interesting number. Net income group share flat, up 1%. Last year, as I mentioned, EUR 745 million of unrealized profits booked on the Hermès. If you restate for this unrealized capital gains, that was one-off in 2010.
The increase in the income exceeds 30%. Still a word on profit from recurring ops by division. It's our benchmark indicator. We look at it in detail. Always Wines & Spirits up 18%. You saw earlier that sales growth in euro was 8%. Growth far outstripping that of revenue. Margin up 2.7%, which is quite remarkable. If you look at all our divisions, profit from recurring operations has grown faster than their sales. Margins have improved systematically. It's a case in Fashion. Margin up 15, profit up 20. I won't detail them all, but it's significant. 16% increase in revenue, 22% increase in profit. We've improved our profit up 1%, 22% of revenue. Still on profit from recurring operations. It's grown through our own business, but also through scope effects. I mentioned Ile de Beauté, Bulgari.
These two businesses, especially Bulgari, contributed to the tune of EUR 87 million to our profit from recurring operations, 2%. Forex, which is a very significant currency impact, pretty nil this time. I won't mention it. You see profit from recurring operations up 22%, 20% linked to the efforts of our operationals, 2% linked to scope effects. The balance sheet now, not much to say. Worth noting, however, the increase in equity is still 50% total balance sheet, but in absolute terms, EUR 23 billion have grown significantly, driven by the capital increased with the Bulgari transaction and also driven by the increase in market value of our stake in Hermès. Net debt is up. More about that on the next slide. Inventories have increased. Two impacts. Bulgari is a jewelry business that consumes a lot of inventories. That has an impact on our balance sheet, but also our other activities.
After an untypical 2010 in inventory terms that have barely increased in 2010, in spite of the upturn in 2011, they increased normally. A word on net debt, pale blue here. It's grown significantly, EUR 4.6 billion at the end of last year. That's the full effect of the Bulgari transaction where we paid in cash, EUR 2.2 billion for the Bulgari transaction. We find that EUR 2.2 billion in the growth of debt over the year. The key point, you can see this on the dark blue line, is that that debt, even if it's increased, remains quite moderate because the percentage of equity stands at 20%. The dividend, a key point because it will be agreed upon, voted on. We're going to propose a dividend of EUR 2.60 against EUR 1.10 last year. On the slide, the annual growth is significant, but it needs to be reviewed over time.
Over the past five years, you had a recession in the middle. You can see that in spite of the recession, the dividend has grown year on year almost, with one exception, which was the dividend in 2008 that was voted at the AGM in 2009. The dividend is up. Its average annual growth, 13%. That's a motive of satisfaction for shareholders and for us to be able to deliver this annual increase in the dividend. Final point that I wish to mention is the share price performance, also cause for satisfaction. Whatever the benchmark comparisons, they're flattering. I've noted one here, which is to consider since the 1st of January 2009, which was the low point, at least on the stock market of the recession.
You can see that over the period, our share price has grown by 165%, whereas over the same period, the CAC 40 has risen by 5%. The figures speak for themselves. Thank you for your attention.
[Foreign language]
Ladies and gentlemen, as it's our custom at our shareholders' meeting, we widely polled our shareholders. We questioned several thousand shareholders in the poll. We have several of these questions. We've got some video clips showing us some of the questions. One of them is a set of questions having mainly to do with business-related matters and other questions that have to do with the economy overall and then our long-term strategy. Let's look at the first clip.
[Foreign language]
As every year, LVMH has polled its individual shareholders, members of the club, to find out what their expectations were for the shareholders' meeting. Now, as I understand, they're interested mostly in the group's strategy. 94% of people were interested in strategy. Next, the outlook for medium and long term. 90% were interested in this. Many of you were also interested in possibilities for growth in emerging countries, as well as developing the group's brands worldwide. What's the strategy in the Asian market? Will there be more shops opened internationally? Several of you have asked about the diversification strategy and launch of new products. What are the earnings for businesses through diversification? Could the company be moving toward hotel businesses as well? Or conceivably, are other products going to be available in France?
You want to know more about the group's positioning and its assets in the overall deteriorated economic situation, wondering about the policy in light of the situation, what the impact is of the crisis on various group branches, asking about the competitive landscape for LVMH. You also ask what our purchasing policy is going to be in future years. Lastly, you're interested in the idea of producing things in France. Many of you are wondering about actions we are undertaking in the group to really use French expertise and craftsmanship, seeking excellence, creativity, and know-how. As you see it, these are some of the main values of LVMH. That's an extension of our signature, this idea of having a passion to be creative. Jean-Jacques Guiony gave us the figures. We saw 2011 was an exceptional year in all areas: revenues, profits.
In all areas, we've seen growth and we've gone beyond growth figures of all previous years. Now, let's look at 2011 a little bit further. I think 2011 is an illustration of the success of the strategy enacted by various brands. As we saw in the brief clip, quality is where it all comes from. That's what's helped us grow in all of our companies. We have to realize, in this group, if we look at our targets, I mean, clearly, we have financial targets. Most importantly, we're focusing on quality, innovation, training of all of our executives and craftsmen and women.
If we look at our financial results, they're satisfactory, but they follow on naturally from our mindset and our clear strategic will, which is to always continue doing better and better, having ever better quality products, being more and more innovative so that globally, we can show people worldwide what France excels at. Shareholders have asked these questions. Clearly, making products in France, made in France, is an essential element. It's not just what we want to do with the group, but it's also an element. It's part of our success, the reason for our success. Many of our competitors, other companies, have their products manufactured in other countries where cost prices are lower, but quality is also lower. There can be supply issues. There can be quality control problems, much more difficult to grapple with outside the country when you manufacture things in France.
Furthermore, this is an important part of our sales pitch. You see it in many of our stores. Products that are labeled made in France are what people are looking for, as opposed to some of the competitors' products. Even when some of our products, think of the United States, some of them are made for Louis Vuitton and always have been made in a workshop on the West Coast of the U.S. It's difficult to export them outside the U.S., though. Customers worldwide, especially in emerging markets, really want products that have been made in France. That's helped us very much. It really boosted us last year. This is why we set up various additional manufacturing workshops in France, three in France for Louis Vuitton, one brand new one, beautiful overall location in [Marzac], in the Drôme. We now have 250 employees there whom we've trained.
We're continuing to train them, make them fully operational to produce leather goods. To answer that question, yes. For us, making products in France is key. I'd also add last year, we hired over 3,000 people, craftspeople, executives, and so forth. Currently, in our group, the number of employees worldwide is just about 100,000. Now, that's not necessarily a target as such, to have a very large number of employees. Nevertheless, I would say we clearly show you that globalization often has beneficial effects, for instance, for France. That really flies in the face of some ideas that some people sometimes believe. It's interesting. Global competition, whether we like it or not, there's global competition that we have to contend with unless you want to close your country off from the others in a sort of abstract or archaic way of trying to do things.
We have no effect, no impact really doing this, just reduced living standards. In other words, we're having to deal with this competition, global competition, and to contend with it. What better way of doing this than making products in a country such as France and then exporting them to emerging countries, China, Brazil, far Eastern countries that are developing beautifully. Last week, I was in Vietnam. It's a country with longstanding historical relations with France, though today, almost nobody is a French speaker in Vietnam. It's unfortunate that they don't speak French as widely as they used to, but that's just the fact of life. A lot of things have happened since the French left Vietnam. It's a country that's booming. It's sort of like China, what, 10 years back, 90 million inhabitants. In that country, people particularly love French products. Think of Bulgari, think of Vuitton.
We're going to be opening up stores. We've already opened a few. We'll open further stores. This has been successful. If you look at the momentum, what's going on in these countries, I mean, it's a socialist-communist country. I don't know how we should actually term it. It's also very much a capitalist country. It's a sort of hybrid, but the country is doing very well. In Vietnam, we can say things are really moving forward. In the next 10 years, we feel that for you, for this group, it's going to provide us with a substantial amount of growth that we can tap into. In 2011, we won market share basically everywhere. You know this. It's already been stated. There was an event. We weren't building one step to cope with this, but a horrible event in Japan.
Here, I would really like to use the opportunity to say just how much I personally admire the Japanese, the way they reacted to the catastrophe. I'd also like to congratulate our teams, whose reaction was fast and they showed true courage. Our teams remained in Japan. None of them asked to come back. We told them they could, of course. We didn't know how things were going to pan out. They all stayed. They continued working. They made themselves available to work in the hardest-hit parts of the country. I'd also say that we rebuilt a store very quickly as need be. I just wanted to make sure that we thank them, express a tribute to them. During those terrible times, the country managed to turn itself around. We can really admire the dynamic process in Japan.
The store was rebuilt in the area, and it's now one of the best ones in Japan. Sendai had been so hard hit. The whole area was hit by the tsunami, the earthquake, the nuclear crisis, and so forth. Japan, for us, was a very sensitive country in 2011, and it continues to be a major market of ours. Even though it has a bit less momentum than elsewhere in Asia and China or elsewhere, it's nonetheless a country where they're really on the cusp of innovation in all areas: cosmetics, perfumes, wines and spirits, fashion, and leather goods. It's a country where I believe it's important to have a long-term presence and make sure, as we do, that that can sort of fan out to all other regions of the world that are also interested in innovation and high-end techniques, cutting-edge techniques that often begin in Japan.
In our various businesses, we can say they've all seen very high points during the year. Wines and spirits, a high point here. What was a wonderful success in some of the most dynamic countries, such wonderful success that we've got a shortage of bottles. When they were talking about Champagne or Cognac, the problem, it's a pleasant one, but the problem isn't to sell the bottles, but to produce enough of them, good quality bottles. It's a good thing. We're selling more and more, better, ever better quality bottles, more expensive bottles. Profitability is great, but growth could be much greater if we could locate products in our cellars. Unfortunately, it's not the case. Now, leather goods, to talk about this business, Louis Vuitton, I won't repeat the progress made by Louis Vuitton. Wonderful, wonderful progress. Just like I mentioned, last year, we opened this wonderful store in Singapore.
The first time that Vuitton really invested in a really just an entire island. We have a Vuitton island there. If you go to Singapore sometime, you can go to the Vuitton island. The decor at this shop is extraordinary. The salespeople, the customers all love it, and people go to visit it and buy products there. Among the further successes last year, perfumes and cosmetics, Dior continues being at the tip-top of cosmetic markets. The perfume J'adore that you know, we have a picture of the ad here. You also saw part of the film at the beginning of the session. J'adore, for the second year running, and even more so than last year, is the most widely sold fragrance in France. Again, 2011. Selective retailing also achieved excellent performance.
DFS used to stand for Duty Free Shoppers, but really now it's luxury retailing, and just some of it is duty-free business. Nonetheless, DFS saw remarkable growth, clearly reaping the benefits of growth in the areas where they're located. Chinese tourists and visitors transit to these locations. I'm thinking maybe of Hong Kong and Macau there as well. The salespeople, whenever I go to these locations, say to me, it's really extraordinary to see the numbers of visitors that come from mainland China, and they're ever more interested in very high-quality products. A few years ago, in these stores, they were selling mainly alcohol and cigarettes. Nowadays, cigarettes are no longer in fashion. Alcohol still is. In addition to that, they're selling a great deal of perfumes. We sell jewelry, also leather goods, of course, and that's mainly the bulk of their business now.
I don't want to spend too much time on that subject, though I could talk to you a lot more about this wonderful business. I'd also mention to you, just to show you different views on these matters, we were really criticized when we bought. This was mid-1990 when we bought this DFS. Same thing for Sephora. Sephora, that's been spectacularly successful. It's a group that saw substantial growth in 2011. It started to show good performance in Asian countries, especially China, and has really reached the top in the U.S. Let me remind you, this is more recent, beginning of 2000. We'd been roundly criticized. Now, Sephora has become a major growth driver in the LVMH group. Of course, this is all done thanks to people, teams. I don't often do this, but I'd very much like to congratulate people.
I underscore the fact this is not a one-man show. I'm the only one speaking for the time being, but it's all about teamwork here. I wanted to really emphasize the performance of the group's Executive Committee and the Senior Executives, who along with me at my side for a long time, maybe some of them think for too long, but for quite some time, I mean, we've all been aging, but for quite some time together, we've been running this business. I wanted to say to them that the work we've achieved together, though, of course, there are ups and downs and the way we're evaluated and the shareholders evaluate us and so forth, all in all, I would say it's very much thanks to them, thanks to the teamwork, and thanks to all of you that we've been successful. They're here.
I would like to tell you who they are. Some of them will be on the stage later. First of all, Wines & Spirits. This is the most sort of iconic, long-standing business. Christophe Navarre, who's here, has led that division for a fair few years now. We remembered the other day that Mr. Navarre, before taking charge of Moët Hennessy, was in oil. Oil business seems weird, yes, but yes. Then he went into beer. He is Belgian, after all. He ended up at the top of Wines & Spirits. Now, of course, it's sort of more sophisticated to be selling Champagne than bubbly beer, but it's also more profitable. It's very successful. Second business, the biggest by size, is Vuitton, Yves Carcelle. Yves, he's a record holder, been with us here in charge for more than 20 years now. Done pretty well, though, huh?
Since he's been here, I think revenues have seen a tenfold increase and profits, I won't even mention, since we don't want to spoil our celebrations with figures that are too precise on profitability and so forth. People might look at this as scant. We just concentrate our efforts on talking about strategy. We'll talk about it later and the beautiful products. I'd also like to mention Toni. Toni has been with me for many years now. He is Group Managing Director of business and most importantly, Selective Retailing and Cosmetics and Perfumes. He also has done many different things. He was in a multinational previously. You know, in luxury, aside from LVMH, there aren't many serious applicants to be found elsewhere. There are a couple of substantial exceptions to that rule, though. I'll come back to that point later.
He came from a multinational, and that multinational had some very clear habits, which he's kept. He has managed to adapt to a very different environment, and I think he's done that beautifully, very efficiently. One mention I'd like to make of a successful operation last year, the open day. We had a special open day. You were all invited. Many of you, I think, did attend. It was very successful. Several hundred thousand people from France visited various LVMH companies. We're a family business. We bring together a whole array of family businesses within this company. It's very important to explain why we're so successful in business. These all remain family businesses. In this group, I mean, I also have my family. My son, Antoine, was in charge of the day. He had the original idea for the open door day, and he was in charge of it.
As I continue talking about family, the last sector I wanted to talk to you about, Watches & Jewelry, is now headed by Francesco Trapani. Francesco Trapani hasn't been at my side for a long time. That is a fact. He arrived this year, but I've known him for about 10 years. For about 10 years, I've been trying to maintain very good relations with him because I've always been fascinated by his work, together with his uncles in charge of Bulgari, to turn it into one of the top jewelry businesses and watch businesses worldwide. It's one of the most prestigious brands. We've known each other for 10 years now. We've been meeting for 10 years. We've had discussions, been friendly, had interesting friendly discussions for about 10 years.
Midway through last year, we decided, he decided, the Bulgari family decided to ensure the future of this iconic Italian brand. Probably the best thing to do would be to get together with the LVMH group. Now, why? I think the main reason for this was that we really share the same values. We have the self-same objective, which is to keep alive, sustain the Bulgari brand for the same reasons it's always been made so successful: innovation and extraordinarily sophisticated quality and jewelry making. Furthermore, they have a global image which has really been brought to a pinnacle thanks to the work done by your family. I believe that you've seen since your arrival all the things we've decided to do together, the respective values. We further increased the quality of investments. If you look at product innovation and manufacturing, these are all very important points for us.
This all dovetails perfectly with how we do things. That's what's made the success of the business. We brought in the group's advantages, our assets in terms of CapEx, retailing, wholesaling, purchasing, communications. We can be much more efficient doing these within a group as opposed to standalone in a business. We've in no way harmed the company's corporate spirit. It's absolutely Italian soul as a jewelry designer creator. I can say that all of this has gone very well, very positively. We've seen growth in business, and that growth has speeded up. If we take a look at the outlook we've got with Bulgari in several different countries, the prospects, some of the ones, some of the countries we just mentioned a moment ago, we can all say that our shared future looks very bright. That is 2011.
It is a year that we could talk a lot more about, but let's just say it was a tremendously good year. It has ushered in 2012. I'm going to talk to you about 2012 after the next clip with questions. Here, we're hearing mainly from economists who are going to be asking questions and doing little brief presentations for shareholders. We're going to listen to that now. Let's watch the next one.
[ Foreign language]
90% of wealth is created by 10% of people. If you prevent those 10 people from creating, then you end up stagnating. There is a financial crisis that is not fully resolved yet. There are changes in the financial system to put it more in line with the productive and creative investment requirements that work must be completed. There are new energies today with the turnaround in the global economy, fairly laborious, gradual, and mixed across regions, but recovering nevertheless. Asia is hugely diverse. We've all understood the role of China for a number of years now. A country such as India and everything that's IT has played a key role over the past 10, 15 years. We can expect that Indonesia, with over 250 million people, will very soon end up with a middle class and therefore strong demand for our products.
I believe now that the continent that poses the greatest problem is Europe. I believe it has a unique combination of quality of life, creativity by Europeans, and open to new consumer needs worldwide.
[Foreign language]
We see that the recovery is driven by businesses, by improved profitability, productive investment, improved export levels. That's a powerful engine. Today, global GDP is growing at 4% a year. There's no doubt that we're entering a period of sustained growth. What will contribute to tomorrow's growth? Essentially, the technological catch-up, infrastructure, growing urbanization, innovation, creativity, innovation not just from the technological standpoint, but creativity in terms of the launch of new products, services, which meet new needs emerging worldwide. Mr. Gav, the economist, is right. It may sound rather paradoxical in the current media setting to say that the world is growing and is in good shape, but that's the reality. Of course, Europe is affected by all the problems that we're familiar with of debt, of increased costs, deficit, etc. The world as a whole will in 2012 experience a growth of the order of 4%.
It's rather interesting for you to be part of a group that from France can derive benefit from that global economic situation, which on the whole is rather buoyant because we export close on 80% of our products. Therefore, with what we produce, we have a very significant growth potential. What I'd like to say about the strategy, since the aim here is to talk about strategy, what's important for us is the long term. What I'm interested in, as I say to our employees, it's not what we're going to do this year. It's what we're going to do in 10 or 15 years' time. What will the group's future look like in 10, 15 years? Will it still be at that time one of the strongest in its field?
I believe that it's on that that we must reflect, especially when we see the way things are developing because the future is not predictable. That's rather unfortunate because if share prices were predictable, we no longer need to have shareholders meeting. We'd all be very rich without too much difficulty. The future's not predictable. Nevertheless, it is we who make the future day after day, our employees who are creating the future of our business. When we look at the development of business over the long term, we see major variations in all respects. Let's take the example in our field of internet, Apple. Apple was a company at the end of the '90s that was on the verge of bankruptcy. All it took was for a new team to arrive at the helm, to begin to innovate, and to soundly manage the company.
For some 10 years later, it becomes the world's leading number one company. It's extraordinary. It really does make you think. I mean, how can we have such a change in a universe that is highly competitive? At the same time, we see developments going the other way. A few years ago, still on the net, there was a key indicator where you turned to have information, a player called Yahoo. That was at the beginning of the year 2000. That search engine today is almost bankrupt. I'm not going to say that it's bankrupt, but at least I don't know. It's totally lost its rise. It's totally overtaken by a competitor founded since then, Google. What I'm saying is nothing is for sure, and things can change very swiftly. There are ways of performing spectacular recoveries.
I don't want to compare our group with Google, but some of you here will no doubt recall that at the end of the 1980s, when we took over a company in France called Boussac. For the young people here, of course, that name doesn't mean anything, but at the time, it was a very large company, and it went bankrupt. We took it over, and it's on the basis of that, from that company, with the assistance of all the teams here present, that we managed to forge LVMH, which is one of the top five companies in the CAC 40 index. Things can move very fast. It's true that we're fortunate in our strategy as compared to companies which today are extraordinarily successful and very much in the eye of the media, in that we have greater sustainability.
I think that in a company such as LVMH, there are a number of things that we can be sure about over 50 years. I mean, in 50 years' time, will the iPhone still be used? Or the people who are making it today, will they have found what will be at the cutting edge at that time? I believe I can say, without being mistaken, that in 50 years' time, we'll still be drinking Dom Pérignon. There really is a solidity in a company such as this that is not to be found, not always to be found in the competitive landscape. It doesn't mean that Dom Pérignon will remain the iconic brand, the most sought-after Champagne, but it does mean that if we do things right, we can, of course, predict many years ahead of time how our business is going to develop and evolve.
That's a key strength. For the group strategy, here I'm at the risk of repeating myself. I mean, this strategy, we've defined it and we stick to it. It remains the same, unchanged. That is priority to innovation, quality products, and all this highlighted by entrepreneurship that, of course, drives our businesses. Let me take an example of quite remarkable performance. In our fashion business, we have a field that comprises a number of mid-sized companies. Pierre-Yves Roussel heads up that operation. We have brands which, thus far, up to three, four years ago, did not really prompt the interest of commentators. Shareholders were saying, "What are you going to do with that? Why have you acquired it? Why are you keeping it?" It was a bit like the Sephora story.
"Why don't you just get rid of it?" They were saying, "You need to be patient because with these businesses, one needs to be patient and find the right combination to make them successful." The right combination takes time. A business such as CELINE, with which we have of all the fashion and leather goods brands, even the greatest, we have the highest growth rates worldwide. I'm not going to cite the names of our peers, but when we're at the side of some well-established competitors whose name is widely known, not in the group, we generate more sales per square meter, which is quite remarkable. A business, 10 years ago, people were saying, "It'll never work." It took time. It took over 10 years to find the right combination. Of course, it was well managed.
I don't in any way wish to underestimate the remarkable quality of the management teams, but we find the right combination to get the business to take off. That is a mix of innovation, creation, a designer who's very original, who's very well suited to the brand, who's designing products meeting customer needs and know-how, a network of stores. We're trying to concentrate on a network of stores. It's all working well. Same thing with other smaller brands where for years it was difficult to get them to take off. They're now successful, bringing quite considerable income, such as Loewe and others, on which we could also go into greater detail. By this, I believe the innovation strategy remains fundamental to the group, and it is truly at the heart of our concerns.
I believe it's vital in order to ensure the future of our long-term business, which is the only interesting metric everyone here is convinced to look over the very long time. That's why we can weather crises because when there's a crisis, of course, we try and see what the advantages we can derive from that crisis. Above all, we look at the post-crisis period and do not allow ourselves to be influenced by a particularly difficult moment in time, such as in 2008, 2009. There were opportunities. We see some of them, 2008, 2009, which perhaps through blindness or a slight disappointment, investors or competitors don't always spot. This long-term expansion of the group, it is crucially important for us that it should be undertaken responsibly. Let me provide you with some information on this. This is key to us.
This is the week of sustainable development, and it's a major growth area. We have over 100,000 employees. We've recruited a number of them last year in France, and we will be continuing this year. In that setting, we are very keen to enhance diversity and to promote equal opportunities in our management teams and amongst our employees. We have a distinctive feature at this time of gender equality that we're seeking to achieve. We have three-quarters of our employees are women, save on the board. We have some delightful ladies, but there's not yet a majority of women board members. 1/3 of our employees are women. One of the challenges is long term to ensure the sustainability of our know-how. To do that, as you know, we are building very modern workshops, but which are craftsmen-based.
We have the equipment, but it's the training of men and women, male and female craftsmen, that accounts for the success. Preserving the environment, natural resources across the group drives our performance. This concern has become paramount for customers, for our partners, and for our employees. It's rolled out in 2011 in various ways. We've striven to drive down our water consumption and greenhouse gases. We've also focused on reducing energy consumption in our stores. We've sought to develop, wherever possible, the use of renewable energy sources with the use of solar panels on a number of our production sites. Louis Vuitton holds the group record with some 1,200 solar panels at the San Dimas facility in California. Water is a precious and vital resource for wines and spirits. That's why several initiatives have been launched in order to protect water, notably recovery of rainwater or specific irrigation methods for vineyards.
The initiatives presented by our companies are presented in an environmental report that is available to you. What is the shorter-term outlook for 2012? I expect growth, as I indicated earlier. Strong growth in Asia. Growth recovery that should be close to 3% in the U.S. Latin America growing strongly. There are the problems that we are familiar with in Europe. Once again, 80% of our products are exported. We are confident in the growth of our business for 2012 and for the first quarter, with a growth of our business over the first quarter higher than what was achieved in Q4 of last year. We are confident. Of course, there's the uncertain outlook in Europe. What's going to happen? What measures are going to be taken left or right in France or elsewhere? We don't quite know what's going to happen.
If everything that is proposed will be delivered, if all that's going to be challenged after the elections, I don't know. We'll see. In any event, we must remain attentive to these possible turbulent developments, to the consequences of problems that may arise on the eurozone, hoping that European leaders will manage to control the situation. We continue on track. We continue to invest across our businesses and to open a number of stores, knowing that our goal is not so much revenue, is not so much profitability. It's to give the best possible quality to our customers and to manufacture products which, in the long term, will enrich our brand image, the pleasure of our shareholders. Consequently, it's only a consequence, profitability return for our shareholders. That's what I wish to say to you this morning. I now hand over to the auditors.
[Foreign language]
Good morning, ladies and gentlemen. It's my pleasure, on behalf of the group of statutory auditors, to present to you the reports that we've drafted for you. All of these reports have been made available to you by the company. They're contained in the reference document which was given to you on entering this room. Therefore, I propose that I not read these out in their entirety, but rather, I would just comment on reports having to do with the resolutions which you're being asked to approve today. We have six reports in all. Two of them have to do with the financial statements. One has to do with related party agreements and commitments, and three have to do with company capital transactions. Let me begin with our reports on the financial statements and the consolidated financial statements, which you can find on page 177 and 205 of the documents.
Now, we've given detailed summary reports to your management and to your audit committee. We've also reported to your board of directors on these. Our report on the consolidated financial statements has to do with work that's been carried out and coordinated by your group of statutory auditors in around 60 significant parts of the group in 15 countries. The conclusion of our checks and audits has been that we certify the consolidated financial statements with no reservation whatsoever. Furthermore, in our report on annual reports, we mention there's a change in the format of the income statement carried out by your company this year. We also have a report on third-party agreements and commitments on pages 207 and 208. This describes agreements between your company and its corporate officers or agreements between your company and company with shared members of the board of directors.
New agreements with prior approval by your board of directors are as follows: rider to the agreement of assistance with the Groupe Arnault SAS, renewal of the joint venture, am I remembering of understanding, with the Atelier d'Horlogerie SA and Christian Dior Couture SA and LVMH, establishment for Mr. Francesco Trapani, a medium-term profit-sharing plan. Other related party agreements and commitments authorized previously and that continued in 2011 have also been included in our special report. Lastly, under the extraordinary part of your shareholders' meeting, we've issued several special reports having to do with resolutions that can have an impact on the future of share capital. These are reports on pages 251, 252, and 253 of the reference document. These are transactions to authorize a capital reduction, to grant options to subscribe or buy shares.
This would be given to employees or corporate officers, and then issue of various tradable securities reserved for employees, part of an employee savings plan. Our report has no comment or special observation we wish to make because these authorizations are in line with provisions contained in the French Code of Commerce. I've finished. Thank you, ladies and gentlemen, for your attention.
[Foreign language]
Ladies and gentlemen, now I'll pass the main senior managers to come to the stage to join us. We would like to field any questions that you might have for us. Ladies and gentlemen, please do introduce yourself before asking your question. Let's start with number two.
[Foreign language]
Good morning, Chairman. I have three questions. Firstly, I was wondering, who is the most demanding woman in the world? The most demanding woman for cosmetics products? A Chinese woman, a French woman, an African woman? Another point. Recently, we've seen changes in your share capital. Qatar taking 1% of your share capital. I was wondering, have they asked to have one or two board members on your Board of Directors? On page 23, I saw that in 2008, you acquired a particular company, and I was wondering if you were considering buying other companies similar to that one. The last question, I was wondering if you're considering recording a classical music record since you own Radio Classique. I was wondering about that as well. Thank you, Chairman.
All of our customers are very demanding. It's difficult to tell you if a Japanese customer would be more demanding than another.
I can just say that taste does vary somewhat. A Japanese person would tend to be very interested in body care products. European women are more attracted to fragrances. Our African customers are interested in many different products, such as makeup especially. It's very difficult to tell you if they're more demanding than others. They're all particularly well informed as to the quality of the products that they can find in the various stores. If they come to Dior or Guerlain, it's precisely because they feel that these are exceptional products, the most exceptional ones. I'm sure that's absolutely true. Qatar bought shares, as have other investment funds. We have a whole range of investment funds that hold investments in LVMH. I can only say I'm pleased to see that our group is attractive to very dynamic investors who are investing in the stock market. Yacht Vinland. This is unique.
It's considered to be the best company in yachting, top quality, best quality. I think there are very few, possibly no competitors able to produce similar quality products. We do not intend to buy another one of these businesses. We're going to really focus our efforts on this one. Now, piano playing, for the time being, we don't have a piano maker in the group, so we won't dwell on that. How would you fit a piano on a plane? You need a 747, after all. Another question?
[Foreign language]
[Foreign language]
Good morning, Mr. Chairman. [Daniel Leschrow], shareholder of LVMH. Sir, earlier you mentioned results for Champagne and others. I would like to know the magical formula, mixing sort of oil and beer to come up with these results. Anyway, seriously, thinking of Watches and Jewelry, your margin rate is 7.7% only. How are you going to improve this? Next, two outsiders, Richemont Cartier, International Watch Company, and there's Piaget and Gucci. I was wondering if something that happened last year in this area is going to continue. If you're going to be continuing to develop watches, if so, what type of watch? What about jewelry?
[Foreign language]
Yes, we continue to invest, as was said, in product innovation, quality of service, as well as in wholesaling and retailing. With Bulgari and other brands, we very much feel that there's a major opportunity to further develop things to increase profitability. Now on to watch movements. The Swatch Group has been reducing its delivery of components. The thing to do is to produce in-house, make internal investments. We already did so in past years, and we'll continue doing that in future years. For the next three years, we have a fairly aggressive plan to insource a big part of components making, the strategic components.
Next question, number six.
[Foreign language]
Good morning, Chairman. Doug Evy, individual shareholder.
It's election time, and people talk, say bad things about the stock exchange. Some people would like to behead you, so to speak. You have to say, though, that you employ a large number of people in France. You have a positive impact on France's trade balance. You, as well as others.
Je n'ai pas entendu parler de couper la tête.
I didn't hear anything about beheading, but I did hear people mention the idea of sort of expropriation. It's not up to me as a business leader to get involved in any political campaigning. I just feel the brunt of some measures that can sometimes be enacted. Some of those measures that have been announced, from both sides of the political spectrum, are somewhat worrying and I think won't be enacted. They've been announced. These are election promises. We know what happens to what becomes of election promises, campaign promises. Either people don't make good on the promises, or they do and end up making a mistake of it. I'm pretty confident, really.
[Foreign language]
Questioner number 2.
[Foreign language]
I'm an individual shareholder representing the AMF, National Association of Shareholders in France. Sir, after two years of strong growth, you write in the shareholder's letter, LVMH has best assets to continue in 2011 with dynamic growth in all business lines. As of February 10, a journalist was analyzing the results and wasn't as bullish, saying that there are effects in Europe and less dynamic things going on in China that could have a negative impact on three of your business lines: Perfumes, alcohol, and Jewelry. What do you think about this? Thank you.
[Foreign language]
It's always, you never know what the economy holds. As I said, you can't predict the future. The first quarter, as I mentioned, is growing. Growth is greater than Q4 of last year, so it's getting off to a pretty good start. Anthony, did you want to give any additional information?
[Foreign language]
That analyst was mentioning points that we keep a very careful eye on. It's true Southern Europe isn't doing all that well. Mr. Arnault said this earlier, and this is no surprise. We got ready for this.
We can't expect to see the same rates of growth all over the world next year as last year. We saw 27% growth in some Asian countries last year. That may not continue exactly at that pace. We can also say, though, that the United States is growing pretty strongly. We are certainly prepared to be flexible during the year. As Mr. Arnault said, the beginning of the year is looking good. We are going to be very aggressive and continue defending ourselves very well. For the time being, the overall context is pretty buoyant.
Question number 5.
Good morning, Sir. [audio distortion] for the APIE Association for Individual Shareholders. We are celebrating our 25th anniversary this year. Every single year, we attend around 70 shareholders' meetings of listed companies. First of all, I have two comments, then I have four brief questions.
My first comment, I'd like to congratulate Antoine Arnault for his good initiative making it possible for 100,000 people to get a better familiarity with LVMH's group, to be able to go visit the workshops. We're all very pleased to have seen this event. Ms. Delphine Arnault, happy birthday, belated birthday, one day late. Now my question. I quickly looked at your revenues by location and compared this to the number of stores in the various areas. We've seen some locations, the number of stores such as France, is directly related to the percentage of revenues. On the other hand, could you tell us, since you're talking about the group five or six years down the road, what geographical locations are you going to really be focusing on in terms of opening new stores? I have a second question.
It has to do with your related party agreements or your covenants. Some of them are not met. You've got about EUR 3.4 billion in credit facilities that are undrawn. Do you have a possibility of doing some external growth in the next three, five, or ten years since you are looking in that direction? Now, another question, the dividend. You're a particularly big shareholder in the Hermès group. Hermès has decided to pay an interim dividend of EUR 7, or EUR 5 special dividend, EUR 7 dividend overall. Are you going to hand on some of that exceptional Hermès dividend to LVMH shareholders?
This is my last question. You talked to us about Vietnam. You know very well. Vietnam's the only Asian country with high literacy rates. Jesuit priests made sure of that. There are still French lycées there, not a whole lot of French spoken unless you meet a lot of French people. 80 million inhabitants. How many stores do you intend to open there? Thank you, sir.
We started with the last one.
Let me begin with that last question. Since I was in Vietnam very recently, we'll be opening, we already have one Louis Vuitton store. We'll open a second one, and we're going to be opening a new Louis Vuitton store. We'll be relocating one of the stores. One of them is small, and we're going to relocate it. We'll be opening two Christian Dior stores. Probably, I mean, we'll continue, but Vietnam, from an economic point of view, is like China was seven or eight years ago. A lot remains to be done before their level of development is as high. I'd also mention, it's somewhat odd to see this. Some Chinese businesses are now offshoring to Vietnam so that they can achieve better, more attractive cost prices than is the case in China. It's almost fascinating to see that shift going on right now. Hermès's dividend.
It was a surprise, a good surprise. Sometimes there are good surprises with Hermès managers, and that's always a good thing. We'll see what the future holds. Growth through acquisition. You mentioned acquisition. In the short term, nothing on the agenda. For the long term, hard to answer. Depends on a lot of other things. Group profitability, cash flow generation. Will it be enough in five years' time? I certainly hope so. In five years' time, to have the wherewithal to buy another company? Maybe. We'll see. Time will tell. We'll see at that time. There aren't that many opportunities, not that many really interesting opportunities. You have to be highly selective. We are.
You have to just sit back, wait, and see. We're in no hurry, considering the potential for development and growth that we already have in our various companies. With Louis Vuitton, great potential for further development, even though, to repeat, that's not the main objective. Growth. The main objective is quality. Growth follows on naturally from quality. We can create desire for our products through that quality. Think of Sephora. I don't know if Chris wants to talk about Sephora, but potential for growth is really tremendous at Sephora. We must be certain that Sephora keeps its mindset, its way of doing things, so that worldwide, Sephora's recipe for success works, just as it does at the Champs-Élysées. We'll be opening a store in Shanghai in the very near future. It'll be even bigger than the Champs-Élysées Paris store. We'll see what the future holds.
If it works as expected, we'll continue investing. Maybe we'll see in the U.S. We are by far one of the biggest distributors of cosmetics in China.
[Foreign language]
Geographic areas, yes, you mentioned geography as well. Currently, there are the emerging markets and North America. You also have the Middle East area that's very promising, with, of course, colossal wealth extracted from underground. High purchasing power, a lot of visitors visiting the region from Russia, et cetera, really boosts business opportunities. I believe the whole world will post significant growth of the order of 4% growth rate this year. I mean, we will benefit from that trend in Europe, even if domestically the outlook is not great. Europe is a very attractive tourist destination, and we can, in France in particular, welcome many foreign visitors. These foreign visitors are, of course, interested. We see them in our stores.
If you walk around the Champs-Élysées on a Saturday, you see that it's difficult to enter the Louis Vuitton store, which in fact poses a problem for us because in order to treat in an elitist and pleasant manner customers coming to acquire high-quality products, which for some are extremely expensive, it's not always easy when you have such a considerable crowd throng in the middle of the store. There's a balance to be struck between the quality of service on the one hand and the desire, which is considerable, of all these visitors. We're considering that for the midterm because we expect the trend to continue in the coming years.
[Foreign language]
Eight, please.
Yes, Mr. Chairman, as you know, a number of French companies provide their shareholders under certain conditions in order to better get to know them, tend to increase the dividend by 10%.
Would it be possible to do the same thing here? What's your view?
[Foreign language]
Yes, it's true. I mean, some companies are to hold the shares that have to have held the registered shares for a number of years. I'm sure Mr. Arnault, who has the registered shares for a number of years, would be delighted to have an increased dividend. However, group policy is to treat all shareholders in a similar manner, but also to treat them well, as you saw on the chart earlier in terms of dividend increase. In these rather turbulent times, I'm in favor of equality. I think that's probably best in every respect.
[Foreign language]
Any more questions?
[Foreign language]
I'm a former glassmaker and a writer, sir. Mr. Chairman, you are a star. Or rather, you are one of the three stars with Martin Bouygues and François Pinault of a cartoon entitled The Sellers of the CAC 40, published last year by 12Biz. In presenting a conspiracy, the authors highlighted the strengths and weaknesses of the conversion of captains of industries in magnates of the vineyards. We even see you on an airship with the [coat of arms] of LVMH going from Château d'Yquem to Cheval Blanc. How did you find out about the existence of that cartoon strip? Was your permission sought? What was your reaction? Thank you.
[Foreign language]
I have to say that I'm not a big reader of cartoon strips. I mean, I heard about that. I saw a couple of pages of that comic strip book, but I mean, that's it. Satirical articles are published just about every week. I tend to put them in a box and leave them there.
[Foreign language]
The hot air balloon, yeah, that's an idea. That'd be kind of an idea for maybe a seminar. Take the Executive Committee to ride in a hot air balloon, go from Château d'Yquem to Château Cheval Blanc by hot air balloon. That'd be a change from staying in dark rooms, looking at charts and accounts. Maybe that cartoon strip offers some useful ideas.
[Foreign language]
[Foreign language]
Since the justified leaving of John Galliano from Dior, I mean, who can replace him there? Madam, it's Dior, the couture and haute couture, and the shareholders' meeting of Dior is being held this afternoon. The business is in great shape. If you want more details, I invite you to attend this afternoon's meeting where we will be discussing this wonderful brand. I have to say that it's not part of LVMH, but it's doing very well. Last question, perhaps.
[Foreign language]
[Foreign language]
Yes, I'm a small private shareholder. My question is as follows: most of the LVMH products are really financially too expensive for small shareholders. I mean, it would not be possible to offer more affordably priced products for faithful, loyal shareholders. Thank you.
[Foreign language]
Let's not exaggerate things. I mean, there are products. I mean, if you take a Dior lipstick or a perfume, they're expensive, but they're affordable. If you take a Dior crocodile bag, of course, that's something different or from Vuitton. No. Let me say that there are already special offers for the shareholders' club. If you join the shareholders' club, you should normally be able to benefit from time to time from those special offers as a shareholder. Quality, I'm not saying that it's priceless, but it's true that it does come at a price. It's always the same difficulty. We want to, of course, satisfy our customers, but our products, what they seek in us, is really the acme of quality.
We see that in countries the most remote, where not necessarily countries with the highest living standards, but there is an increased demand for products of the highest quality, the highest end products, products that are sometimes amongst the most expensive, and these are products that are developing at a faster pace than the cheaper products. The same goes for Champagne or Cognac, where the most sought-after qualities are the best. That is to say, the most expensive. Ladies and gentlemen, we will now move to vote on the resolutions.
[Foreign language]
Ladies and gentlemen, let me announce that we've achieved a quorum. We've exceeded 72%. I put to the vote the first resolution on the approval of the accounts for 2011. Please vote now.
[Foreign language]
[Foreign language]
[Foreign language]
Approved. Resolution number three, approval of regulated party agreements. Please vote.
[Foreign language]
Approved. Fourth resolution, the dividend. Please vote.
[Foreign language]
Motion carried. Resolution number five, ratification of the co-optation of Mr. Francesco Trapani as Director. Please vote.
[Foreign language]
Approved. Resolution number six, ratification of the co-optation of Felix Rohatyn as Advisory Board Member. Well done, Francesco.
[Foreign language]
Please vote.
[Foreign language]
Approved. Done, Felix. Resolution number seven, appointment of Antoine Arnault as Director. Please vote.
[Foreign language]
Approved. Done, Antoine.
[Foreign language]
Resolution number eight, appointment of Mr. Albert Frère as Director. Please vote.
A[Foreign language]
Approved. Congratulations, Albert. Resolution nine, appointment of Gilles Hennessy as Director. Please vote.
[Foreign language]
Approved. Congratulations, Gilles. Resolution 10, appointment of Lord Powell as Director. Please vote.
[Foreign language]
Approved. Resolution number 11, appointment of Yves Thibault de Silguy as Director. Please vote.
[Foreign language]
Carried. Congratulations, Yves. Resolution number 12, determination of the amount of director's fees. Please vote.
[Foreign language]
Approved. Resolution number 13, authorize the Board to trade in the company's shares. Please vote.
[Foreign language]
Approved. Resolution number 14, authorize the board to reduce the share capital by canceling the shares acquired in accordance with the 13th resolution. Please vote. Approved. Resolution 15, authorization to the board to grant share purchase or share subscription options. Because we stopped the stock options two years ago to employees and Senior Executives of the group. Please vote.
[Foreign language]
Approved. Resolution 16, delegation to the Board to increase capital for group employees. Please vote.
[Foreign language]
Approved. 17th and final resolution, amendment of Article 23 of the bylaws to ensure compliance with legal provisions. Please vote.
[Foreign language]
[Foreign language]
[Foreign language]
Approved, ladies and gentlemen. Thank you for your attention.