Translation of the French Interim Financial Report

TRANSLATION OF THE FRENCH INTERIM FINANCIAL REPORT

SIX-MONTH PERIOD ENDED JUNE 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONTENTS

EXECUTIVE AND SUPERVISORY BODIES; STATUTORY AUDITORS AS OF JUNE 30, 2019 1 FINANCIAL HIGHLIGHTS 2 HIGHLIGHTS 4 SHARE CAPITAL AND VOTING RIGHTS 4

BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED 5 FINANCIAL STATEMENTS OF LVMH GROUP

COMMENTS ON THE CONSOLIDATED INCOME STATEMENT 6 WINES & SPIRITS 10 FASHION & LEATHER GOODS 11 PERFUMES & COSMETICS 13 WATCHES & JEWELRY 14 SELECTIVE RETAILING 15 COMMENTS ON THE CONSOLIDATED BALANCE SHEET 16 COMMENTS ON THE CONSOLIDATED CASH FLOW STATEMENT 18

CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS 21

CONSOLIDATED INCOME STATEMENT 22 CONSOLIDATED STATEMENT OF COMPREHENSIVE GAINS AND LOSSES 23 CONSOLIDATED BALANCE SHEET 24 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 25 CONSOLIDATED CASH FLOW STATEMENT 26 SELECTED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 27

STATUTORY AUDITORS’ REVIEW REPORT ON THE HALF-YEARLY FINANCIAL INFORMATION 58

STATEMENT BY THE COMPANY OFFICER RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT 59

This document is a free translation into English of the original French “Rapport financier semestriel”, hereafter referred to as the “Interim Financial Report”. It is not a binding document. In the event of a conflict in interpretation, reference should be made to the French version, which is the authentic text. WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d EXECUTIVE AND SUPERVISORY BODIES; STATUTORY AUDITORS AS OF JUNE 30, 2019

Board of Executive Performance Directors Committee Audit Committee

Bernard Arnault Bernard Arnault Yves-Thibault de Silguy (a) Chairman and Chief Executive Officer Chairman and Chief Executive Officer Chairman Antonio Belloni Antonio Belloni Antoine Arnault Group Managing Director Group Managing Director Charles de Croisset (a) Antoine Arnault Delphine Arnault Louis Vuitton Products Delphine Arnault Nicolas Bazire Nicolas Bazire Nominations and Development and Acquisitions Compensation Committee Sophie Chassat (a) Pietro Beccari Charles de Croisset (a) Christian Dior Couture Charles de Croisset (a) Chairman Diego Della Valle (a) Michael Burke Louis Vuitton Marie-Josée Kravis (a) Clara Gaymard (a) Chantal Gaemperle Yves-Thibault de Silguy (a) Iris Knobloch (a) Human Resources and Synergies Marie-Josée Kravis (a) Jean-Jacques Guiony Lord Powell of Bayswater Finance Ethics and Sustainable Marie-Laure Sauty de Chalon (a) Christopher de Lapuente Development Committee Sephora and Beauty Yves-Thibault de Silguy (a) Yves-Thibault de Silguy (a) Philippe Schaus Hubert Védrine (a) Chairman Wines & Spirits Delphine Arnault Sidney Toledano Advisory Board members Fashion Group Marie-Laure Sauty de Chalon (a) Yann Arthus-Bertrand Jean-Baptiste Voisin Hubert Védrine (a) Strategy Paolo Bulgari

General Secretary Statutory Auditors

Marc-Antoine Jamet ERNST & YOUNG Audit represented by Gilles Cohen and Patrick Vincent-Genod MAZARS represented by Isabelle Sapet and Loïc Wallaert

(a) Independent Director.

Interim Financial Report - Six-month period ended June 30, 2019 1 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d FINANCIAL HIGHLIGHTS

Revenue Change in revenue by business group June 30, 2019 June 30, 2018 Change (EUR millions) (EUR millions and percentage) Published Organic (a) 46,826 42,636 Wines & Spirits 2,486 2,271 +9 % +6 % Fashion & Leather Goods 10,425 8,594 +21% +18%

As of June 30 Perfumes & Cosmetics 3,236 2,877 +12% +9% 25,082 Watches & Jewelry 2,135 1,978 +8% +4% 21,750 Selective Retailing 7,098 6,325 +12% +8% 19,714 Other activities and eliminations (298) (295) - -

Total 25,082 21,750 +15% +12%

(a) On a constant consolidation scope and currency basis. The net impact of exchange rate ﬂuctuations on Group revenue was +3% and the net impact of changes in the scope of consolidation was nil. The principles used to determine the net impact of exchange 2017 2018 2019 rate ﬂuctuations on the revenue of entities reporting in foreign currencies and the net impact of changes in the scope of consolidation are described on page 9.

Revenue by geographic region of delivery Revenue by invoicing currency France 9% Euro 21% Europe (excl. France) 17% US dollar 29% United States 23%

Japan 7% Japanese yen 7%

Asia (excl. Japan) 33% Hong Kong dollar 6%

Other markets 11% Other currencies 37% Proﬁt from recurring operations (EUR millions)

10,003 Proﬁt from recurring operations by business group June 30, Dec. 31, June 30, (EUR millions) 2019 2018 (1) 2018 (1) 8,293 Wines & Spirits 772 1,629 726 As of June 30 Fashion & Leather Goods 3,248 5,943 2,775 5,295 Perfumes & Cosmetics 387 676 364 4,648 3,640 Watches & Jewelry 357 703 342 Selective Retailing 714 1,382 612 Other activities and eliminations (183) (330) (171)

Total 5,295 10,003 4,648 2017 (1) 2018 (1) 2019

Stores Stores by geographic region (number) (number as of June 30, 2019) 1,163 4,699 Europe (a) 4,592 1,341 4,416 Asia (b)

522 792 France United States 420 Japan

06/30/18 12/31/18 06/30/19 461 Other markets (a) Excluding France. (b) Excluding Japan.

2 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d Basic Group share of net Net proﬁt Net proﬁt, Group share earnings per share (EUR millions) (EUR millions) (EUR) 6,990 6,354 12.64

3,605 3,268 6.49 3,292 3,004 5.97

06/30/18 (1) 12/31/18 (1) 06/30/19 06/30/18 (1) 12/31/18 (1) 06/30/19 06/30/18 (1) 12/31/18 (1) 06/30/19

Net cash from Operating free operating activities Operating investments cash ﬂow (a) (EUR millions) (EUR millions) (EUR millions) 8,490 3,038 5,452

4,189 1,423 1,204 3,161 1,957 1,695

06/30/18 (1) 12/31/18 (1) 06/30/19 06/30/1812/31/18 06/30/19 06/30/18 (1) 12/31/18 (1) 06/30/19 (a) See the consolidated cash flow statement on p. 26 for the definition of operating free cash flow.

Equity and Net ﬁnancial Dividend per share (a) Net ﬁnancial debt (a) debt/Equity ratio (a) (EUR) (EUR millions) (EUR millions and percentage) 8,684 35,390 6.00 33,957 5.00 7,359 31,482 5,487 (b)

Interim 2.20 (b) 2.00 1.60 24.5% 23.4% 16.2%

2017 2018 2019 06/30/18 (1) 12/31/18 (1) 06/30/19 06/30/18 (1) 12/31/18 (1) 06/30/19 (a) Gross amount paid for fiscal year, (a) Excluding “Lease liabilities” and “Purchase (a) In 2018, excluding the acquisition of excluding the impact of tax regulations commitments for minority interests”. See Note 19.1 Belmond shares. See Note 18.1 to the applicable to the recipient. to the condensed consolidated financial 2018 consolidated financial statements. (b) Payable on December 10, 2019. statements for definition of net financial debt. (b) Excluding the acquisition of Belmond shares. See Note 18.1 to the 2018 consolidated financial statements.

(1) The 2017 and 2018 financial statements have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed consolidated financial statements regarding the impact of the application of IFRS 16.

Interim Financial Report - Six-month period ended June 30, 2019 3 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d HIGHLIGHTS Highlights of the first half of 2019 include: • good progress in jewelry, in particular for Bvlgari; • further double-digit increases in revenue and profit from • Sephora's strong revenue growth in stores and online; recurring operations; • solid progress of DFS, particularly in Europe, benefiting from • strong growth in Asia, the United States and Europe, particularly the rise in international travelers; in France, which saw a rebound in the second quarter; • the completion in April of the acquisition of the Belmond • good start to the year for Wines & Spirits; hotel group, whose activity will be consolidated in the third quarter of 2019; • remarkable momentum at Louis Vuitton where profitability remains at an exceptional level; • announcement of the agreement with Stella McCartney House; • remarkable performance of Christian Dior Couture; • operating free cash flow of 1.7 billion euros; • rapid progress of LVMH’s perfumes & cosmetics flagship brands; • net debt to equity ratio (“gearing”) of 24.5% as at the end of June 2019.

SHARE CAPITAL AND VOTING RIGHTS

Number Number of % of capital % of voting of shares voting rights (a) rights

Arnault Family Group 238,393,953 465,628,350 47.17% 63.32% Other 267,037,332 269,767,103 52.83% 36.68%

Total 505,431,285 735,395,453 100.00% 100.00%

(a) Total number of voting rights that may be exercised at Shareholders’ Meetings.

4 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP

1. COMMENTS ON THE CONSOLIDATED INCOME STATEMENT 6 2. WINES & SPIRITS 10 3. FASHION & LEATHER GOODS 11 4. PERFUMES & COSMETICS 13 5. WATCHES & JEWELRY 14 6. SELECTIVE RETAILING 15 7. COMMENTS ON THE CONSOLIDATED BALANCE SHEET 16 8. COMMENTS ON THE CONSOLIDATED CASH FLOW STATEMENT 18

Interim Financial Report - Six-month period ended June 30, 2019 5 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated income statement

1. COMMENTS ON THE CONSOLIDATED INCOME STATEMENT

1.1 Analysis of revenue

Change in revenue per quarter Revenue by geographic region of delivery (EUR millions and percentage) 12,538 (as %) June 30, Dec. 31, June 30, 12,544 25,082 2019 2018 2018 16% 15% 15% France 9 10 9 Europe (excl. France) 17 19 18 United States 23 24 23 11% Japan 7 7 7 12% 12% Asia (excl. Japan) 33 29 31 Other markets 11 11 12

– Total 100 100 100

– – 5% By geographic region of delivery and compared to June 30, 3% 3% 2018, the relative contributions of Europe (excluding France) and “Other markets” to Group revenue fell by 1 point to 17% 1st quarter 2nd quarter 1st half-year and 11%, respectively. The contribution of Asia (excluding Japan) rose 2 points to 33%, while the relative contributions of France, Organic growth the United States and Japan remained stable at 9%, 23% and 7%, Changes in the scope of consolidation (a) respectively. Exchange rate ﬂuctuations (a)

(a) The principles used to determine the net impact of exchange rate ﬂuctuations on Revenue by business group the revenue of entities reporting in foreign currencies and the net impact of changes in the scope of consolidation are described on page 9. (EUR millions) June 30, Dec. 31, June 30, 2019 2018 2018 Consolidated revenue for the period ended June 30, 2019 was 25,082 million euros, up 15% from the first half of 2018. Wines & Spirits 2,486 5,143 2,271 The Group’s main invoicing currencies strengthened against Fashion & Leather Goods 10,425 18,455 8,594 the euro – in particular the US dollar, which rose 7% – boosting Perfumes & Cosmetics 3,236 6,092 2,877 revenue growth. Watches & Jewelry 2,135 4,123 1,978 No changes to the Group’s consolidation scope have occurred Selective Retailing 7,098 13,646 6,325 since January 1, 2018. Other activities and eliminations (298) (633) (295) On a constant consolidation scope and currency basis, revenue Total 25,082 46,826 21,750 increased by 12%. By business group, the breakdown of Group revenue changed more appreciably. The contribution of Fashion & Leather Goods Revenue by invoicing currency rose 2 points to 42%, while the contributions of Watches & Jewelry and Selective Retailing decreased by 1 point each to 8% (as %) June 30, Dec. 31, June 30, 2019 2018 2018 and 28%, respectively. The contributions of Perfumes & Cosmetics and Wines & Spirits remained stable at 13% and 10%, respectively. Euro 21 22 22 Revenue for Wines & Spirits increased by 9% based on published US dollar 29 29 29 figures. Boosted by a positive exchange rate impact of 3 points, Japanese yen 7 7 7 revenue for this business group increased by 6% on a constant Hong Kong dollar 6 6 6 consolidation scope and currency basis. Champagne and wines Other currencies 37 36 36 achieved growth of 6% based on published figures and 5% on Total 100 100 100 a constant consolidation scope and currency basis, while cognac and spirits grew by 12% based on published figures and 7% The breakdown of revenue by invoicing currency changed very on a constant consolidation scope and currency basis. This little with respect to the first half of 2018: the contribution of performance was largely driven by higher prices as well as an the euro fell by 1 point, while that of “Other currencies” rose by increase in sales volumes. Demand remained very strong in the 1 point to 37%. The contributions of the US dollar, the Japanese United States and in Asia, particularly China, which reaffirmed yen and the Hong Kong dollar remained stable at 29%, 7% its status as the second-largest market for the Wines & Spirits and 6%, respectively. business group.

6 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated income statement

Fashion & Leather Goods posted organic growth of 18%, equating Revenue for Watches & Jewelry increased by 4% on a constant to 21% based on published figures. This business group’s consolidation scope and currency basis, and by 8% based on performance was driven by the very solid momentum achieved published figures. The business group was boosted by strong by Louis Vuitton and Christian Dior Couture, as well as by Loewe, momentum at Bvlgari, as well as solid performance at Hublot Rimowa, Berluti, Fendi and Loro Piana, which confirmed their and Chaumet. TAG Heuer continued its repositioning. Asia and potential for strong growth. Japan were the most buoyant regions. Revenue for Perfumes & Cosmetics increased by 9% on a constant Revenue for Selective Retailing increased by 8% on a constant consolidation scope and currency basis, and by 12% based on consolidation scope and currency basis, and by 12% based on published figures. This performance confirmed the effectiveness published figures. The business group’s performance was driven of the value-enhancing strategy resolutely pursued by the Group’s by Sephora, which saw appreciable growth in revenue, and by brands in the face of competitive pressures. The Perfumes & DFS, which recorded very strong growth, particularly in Hong Cosmetics business group saw significant revenue growth in Asia, Kong and Macao, as well as in Venice. particularly in China.

1.2 Proﬁt from recurring operations

The geographic breakdown of stores is as follows: (EUR millions) June 30, Dec. 31, June 30, 2019 2018 (1) 2018 (1) (number) June 30, Dec. 31, June 30, Revenue 25,082 46,826 21,750 2019 2018 2018 Cost of sales (8,447) (15,625) (7,130) France 522 514 514 Gross margin 16,635 31,201 14,620 Europe (excl. France) 1,163 1,153 1,132 United States 792 783 754 Marketing and selling expenses (9,563) (17,755) (8,305) Japan 420 422 414 General and administrative expenses (1,789) (3,466) (1,679) Asia (excl. Japan) 1,341 1,289 1,195 Income/(loss) from joint ventures Other markets 461 431 407 and associates 12 23 12 Total 4,699 4,592 4,416 Profit from recurring operations 5,295 10,003 4,648 Operating margin (%) 21.1 21.4 21.4 General and administrative expenses totaled 1,789 million euros, up 7% based on published figures and up 5% on a constant IFRS 16 Leases was applied as of January 1, 2019. In accordance consolidation scope and currency basis. They amounted to 7% with the standard, data for fiscal year 2018 was not restated. of revenue, down 0.6 points relative to the first half of 2018. The Group achieved a gross margin of 16,635 million euros, up 14% from the first half of 2018. As a percentage of revenue, Proﬁt from recurring operations by business group the gross margin was 66%, 0.9 points lower than in the first half of 2018. (EUR millions) June 30, Dec. 31, June 30, 2019 2018 (1) 2018 (1) Marketing and selling expenses totaled 9,563 million euros, up 15% based on published figures and up 12% on a constant Wines & Spirits 772 1,629 726 consolidation scope and currency basis. This increase was mainly Fashion & Leather Goods 3,248 5,943 2,775 due to the development of retail networks but also to higher Perfumes & Cosmetics 387 676 364 communications investments, especially in Perfumes & Cosmetics. Watches & Jewelry 357 703 342 The level of these expenses expressed as a percentage of revenue Selective Retailing 714 1,382 612 remained stable at 38%. Among these marketing and selling Other activities and eliminations (183) (330) (171) expenses, advertising and promotion costs amounted to 12% of revenue, increasing by 14% on a constant consolidation scope Total 5,295 10,003 4,648 and currency basis. The Group’s profit from recurring operations was 5,295 million euros, up 14%. Restated for the positive 77 million euro impact of the initial application of IFRS 16, this increase amounted to 12%. The Group’s operating margin as a percentage of revenue was 21.1%, down 0.3 points from the first half of 2018

(1) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed half-year consolidated financial statements regarding the impact of the application of IFRS 16.

Interim Financial Report - Six-month period ended June 30, 2019 7 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated income statement

Change in profit from recurring operations Fashion & Leather Goods (EUR millions) June 30, Dec. 31, June 30, (a) Changes in(a) Exchange 2019 2018 (1) 2018 (1) Organic the scope of rate growth consolidation fluctuations Revenue (EUR millions) 10,425 18,455 8,594 +3 5,295 +644 – Profit from recurring operations (EUR millions) 3,248 5,943 2,775 Operating margin (%) 31.2 32.2 32.3 4,648 Fashion & Leather Goods posted profit from recurring operations of 3,248 million euros, up 17% compared to the first half of 2018, and up 16% restated for the positive impact of the initial application of IFRS 16. Louis Vuitton maintained its exceptional level of profitability while continuing its robust investment policy, Christian Dior Couture achieved a record performance, 1st half-year 1st half-year 2018 2019 and Loewe and Rimowa confirmed their growth momentum. The other fashion brands continued to strengthen. The business (a) The principles used to determine the impact of exchange rate fluctuations on the profit from recurring operations of entities reporting in foreign currencies and the group’s operating margin as a percentage of revenue fell by impact of changes in the scope of consolidation are described on page 9. 1.1 points to 31.2%. Exchange rate fluctuations had a positive overall impact of 3 million euros on profit from recurring operations compared Perfumes & Cosmetics to the first half of 2018. This total comprises the following three June 30, Dec. 31, June 30, items: the impact of exchange rate fluctuations on export and 2019 2018 (1) 2018 (1) import sales and purchases by Group companies, the change in the net impact of the Group’s policy of hedging its commercial Revenue (EUR millions) 3,236 6,092 2,877 exposure to various currencies, and the impact of exchange rate Profit from recurring operations fluctuations on the consolidation of profit from recurring (EUR millions) 387 676 364 operations of subsidiaries outside the eurozone. Operating margin (%) 12.0 11.1 12.7 On a constant consolidation scope and currency basis, the Profit from recurring operations for Perfumes & Cosmetics was Group’s profit from recurring operations increased by 14%, and 387 million euros, up 6% compared to the first half of 2018. by 12% restated for the positive 77 million euro impact of the This growth was driven by Parfums Christian Dior, Guerlain initial application of IFRS 16. and Parfums Givenchy, which posted improved results thanks to the success of their flagship product lines and strong Wines & Spirits innovative momentum. The business group’s operating margin as a percentage of revenue fell by 0.7 points to 12.0%. June 30, Dec. 31, June 30, 2019 2018 (1) 2018 (1) Watches & Jewelry Revenue (EUR millions) 2,486 5,143 2,271 Profit from recurring operations June 30, Dec. 31, June 30, (1) (1) (EUR millions) 772 1,629 726 2019 2018 2018 Operating margin (%) 31.1 31.7 32.0 Revenue (EUR millions) 2,135 4,123 1,978 Profit from recurring operations for Wines & Spirits was 772 million Profit from recurring operations euros, up 6% relative to the first half of 2018. Champagne and (EUR millions) 357 703 342 wines contributed 214 million euros, while cognacs and spirits Operating margin (%) 16.7 17.1 17.3 accounted for 558 million euros. This performance was the Profit from recurring operations for Watches & Jewelry was result of both sales volume growth and a robust price increase 357 million euros, up 4.5% relative to the first half of 2018, and policy. The operating margin as a percentage of revenue for up 3% restated for the positive impact of the initial application this business group decreased by 0.9 points to 31.1%. of IFRS 16. This increase was the result of strong performance at Bvlgari and Hublot. The operating margin as a percentage of revenue for the Watches & Jewelry business group fell by 0.6 points to 16.7%.

8 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated income statement

Selective Retailing up 9% restated for the positive impact of the initial application of IFRS 16. This performance was driven by DFS, which improved June 30, Dec. 31, June 30, its profitability. The business group’s operating margin as a 2019 2018 (1) 2018 (1) percentage of revenue grew by 0.4 points to 10.1%.

Revenue (EUR millions) 7,098 13,646 6,325 Other activities Proﬁt from recurring operations (EUR millions) 714 1,382 612 The result from recurring operations of “Other activities and Operating margin (%) 10.1 10.1 9.7 eliminations” was a loss of 183 million euros, weakening with respect to the first half of 2018. In addition to headquarters expenses, Profit from recurring operations for Selective Retailing was this heading includes the results of the Media division, Royal 714 million euros, up 17% compared to the first half of 2018, and Van Lent yachts, and the Group’s hotel and real estate activities.

1.3 Other income statement items

- interest on lease liabilities recognized as part of the initial (EUR millions) June 30, Dec. 31, June 30, 2019 2018 (1) 2018 (1) application of IFRS 16, which amounted to an expense of 145 million euros; Profit from recurring operations 5,295 10,003 4,648 - other financial income and expenses, which amounted to a Other operating income and expenses (54) (126) (70) net expense of 9 million euros, compared to net income of Operating profit 5,241 9,877 4,578 34 million euros in the first half of 2018. The expense related to the cost of foreign exchange derivatives was 102 million Net financial income/(expense) (205) (388) (22) euros, versus an expense of 68 million euros a year earlier. Income taxes (1,431) (2,499) (1,264) Lastly, other income from financial instruments, which mainly Net profit before minority interests 3,605 6,990 3,292 arose from the change in the market value of available for sale financial assets, amounted to net income of 93 million euros, Minority interests (337) (636) (288) compared to 102 million euros as of June 30, 2018. Net profit, Group share 3,268 6,354 3,004 The Group’s effective tax rate was 28%, remaining stable compared “Other operating income and expenses” amounted to a net expense to the first half of 2018. of 54 million euros, compared with a net expense of 70 million Profit attributable to minority interests was 337 million euros, euros in the first half of 2018. As of June 30, 2019, “Other compared to 288 million euros in the first half of 2018; this operating income and expenses” included 37 million euros in total mainly includes profit attributable to minority interests amortization and impairment charges for brands and goodwill. in Moët Hennessy and DFS. The Group’s operating profit was 5,241 million euros, up 14% The Group’s share of net profit was 3,268 million euros, compared compared to the period ended June 30, 2018. to 3,004 million euros in the first half of 2018. This represented The net financial expense for the period ended June 30, 2019 13% of revenue in the first half of 2019, compared to 14% for was 205 million euros, compared with a net financial expense the first half of 2018. The Group’s share of net profit in the first of 22 million euros as of June 30, 2018. This item comprised: half of 2019 was up 9% compared to the first half of 2018. - the aggregate cost of net financial debt, which totaled 51 million euros, versus a cost of 56 million euros in the first half of 2018, representing a reduction of 5 million euros;

Comments on the determination of the impact of exchange rate ﬂuctuations and changes in the scope of consolidation

The impact of exchange rate fluctuations is determined by translating the financial statements for the fiscal year of entities with a functional currency other than the euro at the prior fiscal year’s exchange rates, without any other restatements. The impact of changes in the scope of consolidation is determined as follows: - for the fiscal year’s acquisitions, by deducting from revenue for the fiscal year the amount of revenue generated during that fiscal year by the acquired entities, as of their initial consolidation; - for the prior fiscal year’s acquisitions, by deducting from revenue for the fiscal year the amount of revenue generated over the months during which the acquired entities were not consolidated in the prior fiscal year; - for the fiscal year’s disposals, by adding to revenue for the fiscal year the amount of revenue generated by the divested entities in the prior fiscal year over the months during which those entities were no longer consolidated in the current fiscal year; - for the prior fiscal year’s disposals, by adding to revenue for the fiscal year the amount of revenue generated in the prior fiscal year by the divested entities. Profit from recurring operations is restated in accordance with the same principles.

Interim Financial Report - Six-month period ended June 30, 2019 9 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Wines & Spirits

2. WINES & SPIRITS

achieved strong growth, confirming the power of its value- June 30, Dec. 31, June 30, 2019 2018 2018 enhancing strategy. The launches of Vintage 2008, Vintage Rosé 2006 and a limited edition designed by Lenny Kravitz Revenue (EUR millions) 2,486 5,143 2,271 were extremely well received. Veuve Clicquot was buoyed by Of which: Champagne and wines 960 2,369 903 the momentum of Carte Jaune and its blended Rosé. La Grande Cognac and spirits 1,526 2,774 1,368 Dame 2008, its exceptional cuvée unveiled worldwide this year, received a promising reception. The Maison ramped up its Sales volume (millions of bottles) initiatives to empower women entrepreneurs. Ruinart maintained Champagne 24.4 64.9 24.8 its strong growth, driven by markets in Europe and the United Cognac 50.4 93.3 46.9 States. Through its collaboration with Brazilian artist Vik Muniz, Other spirits 8.7 19.1 8.8 the Maison once again illustrated its support for contemporary Still and sparkling wines 15.3 38.5 15.3 art and its love of nature. Krug kept up its innovative momentum Revenue by geographic region with the introduction of its Krug Grande Cuvée 167e Édition and of delivery (%) Krug Rosé 23e Édition. The “Krug and the Single Ingredient” series France 4 6 5 was once again a great success. Europe (excl. France) 15 19 15 Estates & Wines won a number of awards, reinforcing its wines’ United States 36 32 33 reputation for excellence. Breaking new ground in the world Japan 6 6 6 of wine, Chandon launched Chandon Apéritif in Argentina, Asia (excl. Japan) 27 23 27 a highly innovative product in its category. The acquisition of Other markets 12 14 14 Château du Galoupet, which holds the acclaimed Cru Classé Total 100 100 100 des Côtes-de-Provence designation, marked Moët Hennessy’s debut in the promising category of high-end rosé. (1) Profit from recurring operations Organic revenue growth for cognac was 8%, with sales volumes (EUR millions) 772 1,629 726 up 8%. Hennessy’s solid performance during the period added Operating margin (%) 31.1 31.7 32.0 to its successful track record in recent years, in particular 2018, Operating investments when the Maison became the world’s leading premium spirits of the period (EUR millions) 112 298 108 brand. Its V.S and V.S.O.P ranges of cognac were the main growth drivers in the first half of the year. The Maison enjoyed strong (1) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed momentum in its key markets (the United States, China and consolidated financial statements regarding the impact of the application of travel retail), as well as a surge in emerging markets (including IFRS 16. Africa and the Caribbean), where it made further inroads. While continuing to grow, Hennessy ramped up its investments to maintain Highlights its high level of quality and spur its innovative momentum, illustrated in particular by James Hennessy, X.X.O and the new The Wines & Spirits business group delivered a strong performance. marketing campaign for X.O directed by Sir Ridley Scott. Leveraging its high-quality brand portfolio, it continued to Boosted by growing demand for high-quality products, pursue its value-enhancing strategy and consolidated its leading Glenmorangie and Ardbeg whiskies solidified their positioning position in the prestige products segment, drawing on innovation in prestigious award-winning single malts. and robust marketing investments. The business group saw strong momentum, particularly in the United States, Asia and Belvedere vodka continued its global expansion and differentiated emerging markets. itself in the United States with Single Estate Rye. The Polish distillery worked on an ambitious green energy plan. Organic revenue growth was 5% while sales volumes were down 1%. The increased value was driven by more rapid growth Clos 19 strengthened its position as an innovative e-commerce in prestige cuvées and a firm price increase policy. Moët & platform and continued its expansion in the United States. Chandon gained further ground in its main markets and Woodinville Whiskey Company continued its development celebrated the 150th anniversary of its iconic Moët Impérial cuvée in a number of US states. with a very special event at its historic estate, the Château de Saran. The Maison obtained two sustainable winegrowing Volcán De Mi Tierra tequila recorded very solid growth in certifications for its environmental approach. Dom Pérignon North America.

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Outlook of resonating with new lifestyles and winning over the next generation of consumers. Backed by a powerful network and Resolutely pursuing its value-enhancing strategy, the Wines engaged retail staff, over the months ahead the Wines & Spirits & Spirits business group will continue to draw on excellence Maisons will continue to invest heavily in enhancing the appeal and innovation to strengthen its positions in an uncertain of their brands and increasing their production capacity, while sales environment, where demand remains squarely focused on maintaining an active, quality-driven sourcing policy. Remaining quality. The diverse range of customer experience the business true to their long-term vision, they will step up their pioneering group has built up, thanks to the strength of its creative, high- environmental and social initiatives, and explore innovative quality product portfolio, will help its brands meet their goal solutions alongside their different partners and stakeholders.

3. FASHION & LEATHER GOODS

Highlights June 30, Dec. 31, June 30, 2019 2018 2018 Louis Vuitton’s exceptional momentum was driven by its Revenue (EUR millions) 10,425 18,455 8,594 creativity, which was ever more impactful and innovative across all its product categories. The half-year period featured a wealth Revenue by geographic region of developments, with revenue growth well balanced between of delivery (%) emblematic lines and new creations. Following the lineage of France 8 9 9 previous collaborations, the Artycapucines leather goods collection Europe (excl. France) 23 23 23 brought together Capucines models designed by six artists United States 17 18 17 together with the Maison’s workshops. The Monogram Giant Japan 11 11 11 capsule collection featured an oversized version of the Maison’s Asia (excl. Japan) 32 31 32 signature Monogram print, while Horizon Soft, the latest range of Other markets 9 8 8 luggage designed by Marc Newson, was even lighter and more Total 100 100 100 convenient than its predecessors. On the marketing front, Capucines, Twist and Dauphine – the Maison’s “New Classics” – Type of revenue as a percentage were proudly brandished by muses Emma Stone, Alicia Vikander of total revenue (excluding Louis and Léa Seydoux. The 2020 Cruise ready-to-wear collection Vuitton and Christian Dior Couture) – designed by Nicolas Ghesquière as a fashion dialogue between Retail 68 67 64 New York and Paris – had its runway show debut at the TWA Wholesale 31 32 35 Flight Center at JFK Airport. Louis Vuitton took the occasion Licenses 1 1 1 to unveil the prototype for an ultra-innovative canvas that can Total 100 100 100 display moving images on the bags that feature this material. Virgil Abloh, Creative Director of Menswear, launched a new Profit from recurring operations (1) product line, Louis Vuitton Staples Edition, which revisits men’s (EUR millions) 3,248 5,943 2,775 wardrobe essentials. Other half-year highlights for the business Operating margin (%) 31.2 32.2 32.3 group included the new B Blossom jewelry collection, an extension of the Tambour watch range and three new fragrances Operating investments inspired by the Californian summer. The quality-focused of the period (EUR millions) 544 827 325 transformation of its store network continued, with emblematic Number of stores 1,902 1,852 1,772 locations reopening in Florence, London (Sloane Street), Monaco and Shanghai (IFC). The Maison continued to reinforce (1) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed its production capacity, with the opening of a new leather consolidated financial statements regarding the impact of the application of goods workshop that has received the “BREEAM Very Good” IFRS 16. envionmental certification, in the Maine-et-Loire department of western France at the beginning of the year. Its website for online sales in Europe was recently launched and is available in seven European countries. Louis Vuitton launched its first e-commerce website in France in 2005 and has since extended it to 19 other countries worldwide.

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Christian Dior Couture turned in an exceptional performance Kenzo continued to reinforce its retail presence with a new in all its product categories and all its regions. Runway shows store in New York and those that became directly operated in reflected the Maison’s remarkable creativity: at the Champ de China at the end of 2018. In June, Fashion Week was an occasion Mars, the choreography of Kim Jones’ Menswear collection to celebrate the remarkable growth achieved under the creative evoked the tableaux vivants (living pictures) of the past century; directorship of Humberto Leon and Carol Lim who, after eight Maria Grazia Chiuri’s Haute Couture collection was unveiled in years at Kenzo, decided to focus on their own label, Opening a dreamlike circus-inspired show under a grand tent at the Ceremony. Felipe Oliveira Baptista joined Kenzo as its new Musée Rodin; a tribute to diversity, the 2020 Cruise show was Creative Director. held at El Badi Palace in Marrakesh, mixing African and European Berluti enjoyed excellent momentum, driven by Japan and cultures and expertise. In leather goods, the new 30 Montaigne China in particular. Kris Van Assche’s first ready-to-wear shows line – named after the Maison’s historic address – perfectly were very well received. New collections which arrived in stores illustrates its timeless elegance and expertise, while for the third impressed and expanded the brand’s clientele. Its retail network edition of the Dior Lady Art project, eleven women artists were continued its selective development. given carte blanche to express their vision of the iconic Lady Dior. After Paris and Denver, a new exhibition touched down in Rimowa extended its store network and unveiled new brand London at the Victoria and Albert Museum, and in Dallas. ambassadors for its global marketing campaign. The half-year’s highlights included three collaborations on limited editions, Fendi enjoyed excellent momentum, with especially robust with Bang & Olufsen and artists Daniel Arsham and Alex Israel, growth among its emblematic products such as the Baguette line, as well as the launch of new colors for luggage in the Essential which saw very strong demand. As part of the expansion of its line. The first capsule collection produced as a collaboration store network, the Maison inaugurated its first location in Monaco. between Rimowa and Dior Homme was also revealed. The main highlight of the half-year was the last runway show of Karl Lagerfeld, after 54 years of shared history with the brand Designer Marc Jacobs successfully launched the new line and the Fendi family. An exceptional show featuring both men’s called The Marc Jacobs for his eponymous brand, offering and women’s collections at the Powerlong Museum in Shanghai contemporary wardrobe essentials. and a ceremony at the Grand Palais in Paris paid homage to the Continuing the relationship between LVMH and Rihanna, in legendary fashion designer. The Couture show in Rome in early May Fenty – the singer’s newly created fashion house – launched July once again illustrated Fendi’s exceptional expertise through its website and opened two pop-up stores in Paris and New York. 54 looks in honor of Lagerfeld’s years with the Maison. Patou was acquired by LVMH and welcomed Guillaume Henry Loro Piana’s growth was driven by the vitality of its iconic ranges as Creative Director to relaunch its women’s ready-to-wear. as well as its “Excellences” lines, such as The Gift of Kings, which won over customers with its unrivalled lightness, and its vicuña wool collection. Footwear also turned in a strong performance, Outlook boosted by the launch of a personalized service and the opening of a pop-up store in New York’s Meatpacking District. Staying true to its blend of creative momentum, spirit of innovation and unique wealth of artisanal expertise, Louis Vuitton will Hedi Slimane’s first ready-to-wear collections for Celine continue to enrich its fascinating universe and craft the most were launched in stores in March. The Maison simultaneously beautiful experiences for its customers. The months ahead will inaugurated its new store concept, which it plans to roll out see high-impact initiatives across all its product categories and progressively. The runway shows held in the first half of the the launch of plans for flagship stores. Campaigns and events year, which were very well received, reflected the Maison’s new closely interwoven with Louis Vuitton’s business highlights will identity. support upcoming developments. Christian Dior’s core values For Givenchy, the half-year’s main highlights were the launch of innovation and excellence will continue to expand its of its new Mystic leather goods line and regaining direct control reach and guide its strong growth. An exceptional concept store of its distribution in South Korea. The Maison presented on the Champs-Élysées in Paris will temporarily take over from its first menswear collection designed by Clare Waight Keller, the Maison’s historic 30 avenue Montaigne location, which is in the maze-like gardens of Villa Palmieri in Florence, Italy. undergoing a major transformation. Fendi will continue to expand its collections as well as its partnerships with the world Under the leadership of Creative Director Jonathan Anderson, of art and music. All of the Maisons will maintain their focus on Loewe recorded remarkable growth in all its markets, driven in creativity in their collections, achieving excellence in retail and particular by the commercial and media success of ready-to- the customer experience, and strengthening their digital wear and new handbags, including its Gate model. A series of strategy. events raised the Maison’s profile and accompanied the launch of its capsule collections, a limited edition inspired by Dumbo, Paula’s Ibiza women’s collection and the Eye/Loewe/Nature men’s collection.

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4. PERFUMES & COSMETICS

Dior Backstage range – drawing inspiration from products used June 30, Dec. 31, June 30, 2019 2018 2018 by professional makeup artists backstage at runway shows – should also be highlighted. Growth in skincare was driven Revenue (EUR millions) 3,236 6,092 2,877 by the Asian markets and premium products. Dior Prestige, whose core range continued to expand, saw strong growth in all regions Revenue by geographic region through its new Micro-Lotion de Rose, which joins Micro-Huile of delivery (%) de Rose. France 9 11 11 Europe (excl. France) 19 22 21 Guerlain experienced remarkable growth, driven by its Abeille United States 13 16 14 Royale and Orchidée Impériale skincare lines and by Rouge G and Japan 5 5 5 its new Essentiel foundation in makeup. This momentum was Asia (excl. Japan) 43 35 37 particularly strong in China and in travel retail. With twelve years Other markets 11 11 12 of environmental and social commitments in fields as varied as biodiversity, sustainable design, climate change and social Total 100 100 100 inclusion, Guerlain became the first cosmetics Maison to launch

(1) a transparency and traceability platform, Bee Respect, providing Profit from recurring operations a behind-the-scenes look at the life-cycle of its creations. In May, (EUR millions) 387 676 364 it held the third edition of the Bee University program at Operating margin (%) 12.0 11.1 12.7 UNESCO, assembling leading experts to identify concrete Operating investments solutions to aid bee conservation. of the period (EUR millions) 171 330 135 Parfums Givenchy recorded strong growth once again. Makeup Number of stores 376 354 316 enjoyed increased success in Asia, particularly in China. Growth accelerated in Europe and the rest of the world, thanks to the (1) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed success of its fragrance L’Interdit. consolidated financial statements regarding the impact of the application of Kenzo Parfums IFRS 16. At , the momentum at Flower by Kenzo was buoyed by a new version of its Flower by Kenzo Eau de Vie fragrance. Fenty Beauty by Rihanna reaped the benefits of a very extensive Highlights innovation plan. It reaffirmed its success in new categories, including a lineup of concealers available in 50 different shades, The prestige and appeal of its Perfumes & Cosmetics Maisons, bronzers, setting powders and lip glosses, and also continued the vitality of their iconic lines, the quality of their innovations, its strong social media campaign. Benefit continued to develop as well as robust investments in communication stimulated the its eyebrow collection with its flagship Gimme Brow and Precisely business group’s growth and market share gains. Makeup and products and the expansion of its brow bars, particularly in skincare were particularly dynamic and the market in Asia China. Make Up For Ever launched a new long-lasting concealer remained very buoyant. within its highly popular Ultra-HD range. Fresh continued Following a record year, Parfums Christian Dior continued its its robust growth in China and achieved a solid performance remarkable performance thanks to the strength of its flagship in the American market, supported by its flagship Rose, Black Tea lines. Beyond the early promise shown by Joy, the third best- and Lotus lines. Acqua di Parma relaunched its Barbiere line and selling perfume worldwide, growth in the women’s portfolio offered a completely renewed range of scents and candles for was boosted by the success of the new Miss Dior eau de toilette living spaces. The Maison’s completely renovated store in Milan and the vitality of J’adore. Sauvage – which became the leading reopened its doors, while the first of its stores in China were men’s fragrance in 2018 – maintained its remarkable performance. opened. Perfumes Loewe refreshed its visual identity and Maison Christian Dior saw strong growth, with an exceptional communication strategy, with strong growth in Spain, its historical collection of fragrances available in dedicated stores, confirming market. Maison Francis Kurkdjian launched its Gentle Fluidity its potential, particularly in Asia. The Maison’s roots in Grasse, duo, comprising two very distinct fragrances derived from the the perfume capital of the world, was central to each of its same ingredients. The Ole Henriksen skincare brand continued fragrances and bolstered its international profile. Makeup in its growth in the United States as a result of a well-received particular was boosted by the continued success of the Maison’s digital activation strategy on social media and interest generated Rouge Dior lipstick, its Ultra-Rouge version and the new Dior Addict by its Banana Bright range. Stellar Shine. The performance of its Forever foundation and the

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Outlook will continue its expansion in the premium segment and will be boosted by strong growth in the Asian market. At Guerlain, In a highly competitive environment, the Perfumes & Cosmetics the second half of the year will be highlighted by robust activity business group will leverage the complementarity of its brand in the perfume sector, including strong support for Mon Guerlain portfolio to consolidate its market share in 2019. Innovation, with a new campaign embodied by Angelina Jolie, alongside retail quality and communication investments, including digital, the continued international rollout of Aqua Allegoria and the will remain the key priorities to achieving this ambition. development of the Guerlain Parfumeur boutique network. Parfums Christian Dior will continue to showcase its iconic Parfums Givenchy will relaunch its emblematic couture-inspired fragrances in conjunction with Couture and its roots in Grasse, lipstick Le Rouge and unveil a new version of the fragrance while building a unique fragrance experience for its customers, L’Interdit. Kenzo Parfums will launch a new eau de parfum in its particularly via the rollout of its Maison Christian Dior store Kenzo World range. Make Up For Ever will build on its renowned concept. Makeup will be boosted by several innovations and a expertise in foundation with an innovative multi-purpose strong digital activation that will showcase the Maison’s artful concept. Fenty Beauty by Rihanna will intensify its efforts to color palette and the spirit of its runway shows. Dior skincare gain market share in Asia.

5. WATCHES & JEWELRY

Bvlgari continued its remarkable performance and gained market June 30, Dec. 31, June 30, 2019 2018 2018 share with particular success in the jewelry segment. Growth was driven by the contribution of its iconic Serpenti, B.Zero1, Revenue (EUR millions) 2,135 4,123 1,978 Diva and Lvcea lines, as well as Fiorever, a new collection launched in 2018, inspired by a floral theme incorporating diamonds. Revenue by geographic region The Maison celebrated the 20th anniversary of its B.Zero1 line of delivery (%) with an exhibition in Milan, along with the creation of special France 5 6 5 series and new versions of rings and bracelets. A fourth edition Europe (excl. France) 21 23 22 of the SerpentiForm exhibition was held in Chengdu, while the United States 8 9 9 Wild Pop high jewelry collection, reflecting Bvlgari’s quintessential Japan 12 12 12 expertise and spirit, was successively exhibited in London, Tokyo Asia (excl. Japan) 40 35 37 and Hong Kong. An array of creations encapsulating the Maison’s Other markets 14 15 15 great watchmaking expertise were presented in Geneva and Basel, Total 100 100 100 including the new Serpenti Seduttori, Octo Finissimo Chronograph and Octo Finissimo Tourbillon Carbon, which set two new world Profit from recurring operations (1) records with their exceptionally thin design and contemporary (EUR millions) 357 703 342 elegance. Store openings and renovations continued in Monaco, Operating margin (%) 16.7 17.1 17.3 alongside the installation of temporary stores at destinations including the Champs-Élysées in Paris and Wynn Macau. Operating investments of the period (EUR millions) 142 303 145 TAG Heuer continued to focus on its flagship Carrera, Aquaracer and Formula 1 lines, as it unveiled new models and special series. Number of stores 440 428 413 While the Golf Edition rounded out its range of smartwatches, (1) The financial statements as of December 31 and June 30, 2018 have not been the new Autavia collection marked the return of a legend, restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed augmented with cutting-edge precision. TAG Heuer celebrated consolidated financial statements regarding the impact of the application of IFRS 16. the 50th anniversary of its Monaco model with the launch of limited editions. Highlights Hublot continued its robust growth. This solid momentum was driven by its emblematic Classic Fusion and Big Bang lines, and Growth at the Watches & Jewelry Maisons was driven by the by the remarkable performance of Spirit of Big Bang, which made strength of their iconic lines, the creativity of their new products the biggest contribution to sales growth. Each line featured and increased brand awareness. The best performances were exceptional new models, such as the Classic Fusion Ferrari GT, recorded in jewelry and by the business group’s networks of illustrating the Maison’s power of innovation. Its profile was directly operated stores. raised by an intense program of communications campaigns

14 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Selective Retailing and events centered on sports and culture. Hublot continued to Outlook improve the quality of its distribution and continued to develop its store network, which is now its main source of growth. The Watches & Jewelry business group will maintain its target Two stores were opened in May, at Rome’s Piazza di Spagna and of market share gains in 2019. This ambition will draw on the in Monte Carlo. creativity and masterful expertise of the Maisons’ watchmakers and jewelers, as well as the performance of their directly operated At Zenith, in addition to its iconic Chronomaster, Elite and Pilot stores. It will be coupled with an attentive approach to each specific collections, the Defy line was enriched with new models and market and carefully targeted resource allocation. Marketing saw rapid growth. The Maison continued to consolidate its investments will be robust, with a particular emphasis on digital organization while leveraging synergies offered by the other communications. Substantial resources will also be devoted to watchmaking Maisons. programs focused on distribution quality and productivity. Chaumet’s growth was largely driven by the impressive success Bvlgari presented its new Cinemagia high jewelry collection in of the Bee My Love collection, alongside the iconic Liens and Capri at the end of June, paying tribute to the Italian Maison’s Joséphine lines, with particularly strong momentum in China, long-standing affinity with the silver screen. Also in June, a new Japan and the Middle East. Its collections were enhanced exhibition entitled Bvlgari – The Story, The Dream opened at Castel by new ring and bracelet additions to the Liens Evidence line as Sant’Angelo in Rome, celebrating Bvlgari and Italian fashion. well as the new Boléro watch. Work began on the full renovation The expansion of Bvlgari’s store network will continue. Chaumet of Chaumet’s historic location on the Place Vendôme in Paris. will open a flagship store at its 1881 Heritage site in Hong Kong, A temporary store on Boulevard Saint-Germain hosted an as will Hublot. Zenith and Fred will increase their presence in exhibition dedicated to flora and fauna, which are among the China with a new store in Beijing and Shanghai, respectively. Maison’s major sources of inspiration. In January 2020, Bvlgari Resort Dubai will host the first exhibition of LVMH’s Swiss watchmaking Maisons. This initiative will serve Fred actively developed its Force 10 and 8°0 lines and launched as a new platform to raise awareness of the Group’s brands, in its new Ombre Féline collection. addition to the Geneva and Basel watch trade shows, and will strengthen its foothold in the watchmaking sector.

6. SELECTIVE RETAILING

Highlights June 30, Dec. 31, June 30, 2019 2018 2018 Selective Retailing delivered organic revenue growth of 8%, Revenue (EUR millions) 7,098 13,646 6,325 driven by the strong momentum of all of the business group’s Maisons. Revenue by geographic region of delivery (%) Sephora recorded strong revenue growth, gaining new market France 10 12 11 share in all the countries in which it operates, with a significant Europe (excl. France) 9 9 9 acceleration in Asia and the Middle East. Its store network United States 36 38 37 continued to expand. Online sales grew rapidly. With locations Japan 2 2 2 in 34 countries and its digital presence in 29 markets, the Maison Asia (excl. Japan) 30 27 29 capitalized on its omnichannel synergies to continually improve Other markets 13 12 12 how it serves its customers and achieve its ambition of building the world’s favorite beauty community. The renovation of its Total 100 100 100 stores in La Défense in Paris, Dubai Mall and Times Square in

(1) Manhattan, as well as the opening of magnificent flagship stores Profit from recurring operations at Hudson Yards (New York) and China World (Beijing) let (EUR millions) 714 1,382 612 customers discover Sephora’s new concepts on every continent. Operating margin (%) 10.1 10.1 9.7 The “We Belong To Something Beautiful” marketing campaign Operating investments in North America illustrated Sephora’s commitment to its of the period (EUR millions) 276 537 205 inclusive core values so that everyone feels welcome in its stores. With an ever-larger and more innovative selection of products, Number of stores Sephora cultivated the exclusivity of its offering. Its own Sephora Sephora 1,910 1,886 1,840 Collection brand was very successful in attracting customers and Other 53 54 57 building loyalty. The Good Skincare range launched in the first (1) The financial statements as of December 31 and June 30, 2018 have not been half of the year was a great success. restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed consolidated financial statements regarding the impact of the application of IFRS 16.

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DFS continued to benefit from strong demand at long-haul Enjoying a dual presence on both banks of the Seine, La Grande destinations in Oceania as well as Venice in Europe and its major Épicerie de Paris saw an increase in the number of visitors. markets in Hong Kong and Macao, despite a slowdown observed The 24 Sèvres digital platform became 24S, a name that reflects in recent months. The key shopping periods of Chinese New its increasingly international clientele. Year and Golden Week were very successful. Through a logistics agreement with Shenzhen Duty Free, DFS made its debut in the Chinese market. Several “mini-programs” for travelers were Outlook launched on the WeChat social network and its online product Sephora will continue to pursue its strategy, with ambitious offering expanded rapidly. After appearances in Venice, Chengdu, plans for geographic expansion and market share gains. It will Beijing and Macao in 2018, DFS’s Masters of Time exhibition, open its first stores in South Korea, Hong Kong and New featuring a prestigious collection of watches and jewelry, opened Zealand in the second half of the year. Sephora will continue in Sydney and Hawaii. to leverage innovation and its in-depth understanding of its Starboard Cruise Services expanded its presence aboard new customers’ needs to offer them an ever more personalized prestigious cruise ships following the expiration of contracts service throughout the world. Employee engagement, training with certain cruise lines. It enriched its watches and jewelry and expertise will remain the key priorities to meet this objective offering, notably by opening the largest Bvlgari store at sea. and guarantee customers an exceptional in-store and online The careful attention paid to its different clientele segments was experience. In the second half of the year, DFS will benefit from an integral part of its new store concepts, which offered unique, the completion of major renovations, including two flagship personalized multisensory experiences tailored to each ship and T Gallerias in Hong Kong and Macao, as well as airport stores destination. in San Francisco, Saipan, Okinawa and Cairns in Australia. A fourth store will open in Hong Kong in the very lively Mong Le Bon Marché continued its growth, driven by its unique Kok district, while work will continue at the La Samaritaine site product selection, beautiful architecture and top-quality service. in Paris, in preparation for its grand opening planned for 2020. The half-year period featured an exhibition by Portuguese artist Le Bon Marché will continue to cultivate the exclusivity and Joana Vasconcelos. Another highlight was the Geek mais Chic quality of service upon which it has built its success. Transformations event, a shopping experience for the third millennium, combining will take place on the ground floor of the main store to welcome digital innovation with immersive discovery and featuring more a highly discerning clientele and ensure their utmost satisfaction. than 80 fashion, beauty and decor brands. The Maison’s Salons A punk-themed exhibition will be held in the fall. La Grande Particuliers (private salons) opened at the beginning of June, Épicerie de Paris will keep working to enhance its appeal and accompanied by a personalized shopping and styling service. build customer loyalty on both sides of the Seine.

7. COMMENTS ON THE CONSOLIDATED BALANCE SHEET

(EUR millions) June 30, Dec. 31, Change (EUR millions) June 30, Dec. 31, Change 2019 2018 (1) 2019 2018 (1)

Intangible assets 33,299 30,981 2,318 Equity 35,390 33,957 1,433 Property, plant and equipment 16,225 15,112 1,113 Long-term borrowings 5,588 6,005 (417) Right-of-use assets 12,138 - 12,138 Non-current lease liabilities 10,139 - 10,139 Other non-current assets 5,156 4,656 500 Other non-current liabilities 18,759 17,505 1,254 Equity and non-current liabilities 69,876 57,467 12,409 Non-current assets 66,818 50,749 16,069 Short-term borrowings 7,890 5,027 2,863 Inventories 13,561 12,485 1,076 Current lease liabilities 2,029 - 2,029 Other current assets 10,545 11,066 (521) Other current liabilities 11,129 11,806 (677)

Current assets 24,106 23,551 555 Current liabilities 21,048 16,833 4,215

Assets 90,924 74,300 16,624 Liabilities and equity 90,924 74,300 16,624

(1) The financial statements as of December 31, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed consolidated financial statements regarding the impact of the application of IFRS 16.

16 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated balance sheet

LVMH’s consolidated balance sheet as of end-June 2019 totaled Other non-current liabilities totaled 18.8 billion euros, up 90.9 billion euros, 16.6 billion euros higher than at year-end 1.3 billion euros from 17.5 billion euros as of December 31, 2018. 2018, including 12.1 billion euros related to the application of This growth was due, for 0.7 billion euros, to the increase in IFRS 16 as of January 1, 2019, with right-of-use assets relating to liabilities in respect of purchase commitments for minority leases with fixed lease payments recognized as assets in the balance interests and for 0.3 billion euros to the increase in the market sheet, offset against lease liabilities which were recognized as value of derivatives, as well increases in provisions and other liabilities in the balance sheet. See Note 1.2 to the condensed non-current liabilities and in deferred tax liabilities, for 0.2 billion consolidated financial statements for details on the impact of euros and 0.1 billion euros, respectively. the application of IFRS 16. Consequently, non-current assets Lastly, other current liabilities decreased by 0.7 billion euros, grew significantly by 16.1 billion euros and amounted to 73% of amounting to 11.1 billion euros, mainly due to the decrease in total assets, compared with 68% as of year-end 2018. operating payables, linked to the seasonal nature of the Group’s Intangible assets grew by 2.3 billion euros, of which 1.9 billion activities. euros was due to the recognition of provisional goodwill on Belmond, plus 0.7 billion euros due to the impact on goodwill Net financial debt and equity of the revaluation of purchase commitments for minority interests. Conversely, the application of IFRS 16 resulted in a decrease of (EUR millions or as %) June 30, Dec. 31, Change 0.4 billion euros in intangible assets, due to the reclassification 2019 2018 (1) (2) of leasehold rights as right-of-use assets. Long-term borrowings 5,588 6,005 (417) Property, plant and equipment increased by 1.1 billion euros as Short-term borrowings a result of the inclusion in the scope of consolidation of the and derivatives 8,010 5,157 2,853 property, plant and equipment appearing on Belmond’s balance sheet at the acquisition date for 1.1 billion euros. Investments Gross borrowings for the half-year period, net of depreciation charges as well as after derivatives 13,598 11,162 2,436 disposals, generated an increase of 0.3 billion euros; the comments Cash and cash equivalents (4,914) (5,675) 761 on the cash flow statement provide further information on investments. Lastly, the application of IFRS 16 resulted in a Net financial debt 8,684 5,487 3,197 reclassification of -0.3 billion euros to “Right-of-use assets”, Equity 35,390 33,957 1,433 corresponding to assets held under finance leases. Net financial debt/ Right-of-use assets amounted to 12.1 billion euros as of June 30, Equity ratio 24.5% 16.2% 8.3 pts 2019, including 11.8 billion euros related to the recognition of (1) The financial statements as of December 31, 2018 have not been restated to reflect right-of-use assets for leases with fixed payments, and 0.4 billion the application of IFRS 16 Leases. See Note 1.2 to the condensed consolidated financial statements regarding the impact of the application of IFRS 16. euros related to the reclassification of leasehold rights, previously (2) Net financial debt as of December 31, 2018 was adjusted to take into account presented within “Intangible assets”. Store leases represented Belmond shares, presented within “Non-current available for sale financial assets”. the majority of right-of-use assets, for a total of 9.6 billion euros. See Note 18.1 to the 2018 consolidated financial statements. Other non-current assets increased by 0.5 billion euros, amounting The ratio of net financial debt to equity, amounted to 24.5%, to 5.2 billion euros, primarily as a result of the change in the up 8.3 points compared to 16.2% as of December 31, 2018. This market value of derivatives. change was mainly due to the acquisition of Belmond, which contributed 2.8 billion euros to the increase in the Group’s net Inventories were up 1.1 billion euros, an increase related to financial debt. inventory build-up over the period (see “Comments on the consolidated cash flow statement”). Total equity amounted to 35.4 billion euros as of end-June 2019, up 1.4 billion euros from year-end 2018. Net profit for the six- Other current assets decreased by 0.5 billion euros, mainly due month period, after the distribution of dividends, contributed to the 0.6 billion euro decrease in cash and cash equivalents, 1.2 billion euros to this increase. In addition, exchange rate with operating receivables increasing slightly by 0.2 billion euros, fluctuations had a positive impact of 0.1 billion euros on the while the market value of derivatives increased by 0.1 billion reserves of entities reporting in foreign currencies; this mainly euros. concerned the reserves of entities reporting in US dollars. The application of IFRS 16 resulted in the recognition of lease As of June 30, 2019, total equity was equal to 39% of total assets, liabilities for a total of 12.1 billion euros, including 10.1 billion compared to 46% as of year-end 2018. euros in non-current lease liabilities and 2.0 billion euros in current lease liabilities, offset against right-of-use assets.

Interim Financial Report - Six-month period ended June 30, 2019 17 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated cash flow statement

Gross borrowings after derivatives totaled 13.6 billion euros as of 0.3 billion euros in net financial debt. Cash, cash equivalents, of end-June 2019, up 2.4 billion euros compared with year-end and current and non-current available for sale financial assets 2018. Bond debt increased by 0.7 billion euros, following the used to hedge financial debt totaled 4.9 billion euros as of end- two bond issues completed during the half-year period totaling June 2019, down 0.8 billion euros from 5.7 billion euros at 1 billion euros, and partly offset by the repayment of the year-end 2018. Net financial debt thus increased by 3.2 billion 0.3 million euro bond issued in 2014. Moreover, commercial euros. paper outstanding increased by 1.9 billion euros and bank As of end-June, 2019, the Group’s undrawn confirmed credit lines borrowings by 0.1 billion euros. Following the application of amounted to 5.9 billion euros, exceeding the outstanding portion IFRS 16, finance lease liabilities were reclassified as lease liabilities, of its commercial paper program, which came to 5.1 billion which are excluded from net financial debt, resulting in a decrease euros as of June 30, 2019.

8. COMMENTS ON THE CONSOLIDATED CASH FLOW STATEMENT

(EUR millions) June 30, 2019 June 30, 2018 (1) Variation

Cash from operations before changes in working capital 7,399 5,464 1,935 Cost of net ﬁnancial debt: interest paid (37) (73) 36 Lease liabilities: interest paid (109) - (109) Tax paid (1,191) (907) (284) Change in working capital (1,873) (1,323) (550)

Net cash from operating activities 4,189 3,161 1,028

Operating investments (1,423) (1,204) (219) Repayment of lease liabilities (1,071) - (1,071)

Operating free cash ﬂow 1,695 1,957 (262)

Financial investments including purchase and sale of consolidated investments (1,965) (35) (1,930) Equity-related transactions (2,339) (2,134) (205) Change in cash before ﬁnancing activities (2,609) (212) (2,397)

(1) The financial statements as of June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 to the condensed consolidated financial statements regarding the impact of the application of IFRS 16.

Cash from operations before changes in working capital totaled Tax paid came to 1,191 million euros, 31% higher than 907 million 7,399 million euros, up 1,935 million euros from 5,464 million euros paid a year earlier, mainly due to the increase in the Group’s euros a year earlier. After tax and interest paid on net financial earnings in all the geographic regions in which it operates. debt and lease liabilities, and after the change in working capital, The 1,873 million euro increase in the working capital requirement net cash from operating activities amounted to 4,189 million was 550 million euros higher than the level observed a year euros, up 1,028 million euros from the first half of 2018, including earlier. The cash requirement relating to the increase in inventories 1,061 million euros related to the application of IFRS 16. The amounted to 1,210 million euros for the half-year period, versus impact of the application of IFRS 16 consisted of the cancellation 1,038 million euros a year earlier. The increase in inventories of depreciation of right-of-use assets for 1,171 million euros and mainly concerned the Fashion & Leather Goods and Watches & the recognition of interest paid on lease liabilities for 109 million Jewelry business groups. The decrease in trade accounts payable euros. Since IFRS 16 was only applied to the 2019 fiscal year, and tax and social security liabilities generated an additional cash net cash from operating activities for the first half of 2019 is not requirement of 917 million euros during the half-year period, comparable to the first half of 2018. a significant increase from 567 million euros in the first half of Interest paid on net financial debt totaled 37 million euros in 2018. The decrease in trade accounts receivable of 254 million the first half of 2019, down 36 million euros from 73 million euros (versus 282 million euros in the first half of 2018), helped euros in the first half of 2018, due in particular to the change in to finance only partially the cash requirement generated by the the amounts paid in respect of forward points relating to foreign increase in inventories and the decrease in operating liabilities. exchange swaps having matured during the period. These changes reflect the seasonal nature of the Group’s business activities.

18 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d BUSINESS REVIEW AND COMMENTS ON THE HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS OF LVMH GROUP Comments on the consolidated cash flow statement

Operating investments net of disposals resulted in an outflow and proceeds from sale of non-current available for sale financial of 1,423 million euros as of June 30, 2019, compared to 1,204 million assets. As of June 30, 2018, financial investments accounted for euros a year earlier. These mainly included investments by the an outflow of 35 million euros. Group’s brands – notably Louis Vuitton, DFS, Sephora, Celine Equity-related transactions generated an outflow of 2,339 million and Christian Dior Couture – in their retail networks. They also euros. This amount included 2,012 million euros in dividends included investments related to the La Samaritaine project as paid by LVMH SE during the first half of the year (excluding well as investments by the champagne houses and Hennessy in treasury shares), which comprised the final dividend payment their production equipment. in respect of fiscal year 2018, in addition to tax on dividends Repayment of lease liabilities totaled 1,071 million euros in the paid for 66 million euros. Dividends paid to minority interests first half of 2019. in consolidated subsidiaries amounted to 334 million euros. Conversely, other equity-related transactions generated an inflow As of June 30, 2019, operating free cash flow amounted to of 73 million euros, including 21 million euros related to the 1,695 million euros, down 13% from 1,957 million euros recorded exercise of share subscription options. in the first half of 2018. This indicator is defined in the consolidated cash flow statement. In addition to net cash from The financing requirement after all transactions relating to operating operating activities, it includes operating investments and activities, investing activities and equity-related transactions repayment of lease liabilities, both of which the Group considers thus totaled 2,609 million euros, of which 2,032 million euros as related to its operating activities. were financed by net proceeds from borrowings. The change in the cumulative translation adjustment had a positive 15 million As of June 30, 2019, financial investments accounted for an euro impact on cash balances, after which the period-end cash outflow of 1,965 million euros, including 1,878 million euros balance was 562 million euros lower than year-end 2018, and for the acquisition of Belmond and 81 million euros for purchase totaled 3,851 million euros.

Interim Financial Report - Six-month period ended June 30, 2019 19 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d 20 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

Interim Financial Report - Six-month period ended June 30, 2019 21 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT

(EUR millions, except for earnings per share) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Revenue 24 25,082 46,826 21,750 Cost of sales (8,447) (15,625) (7,130)

Gross margin 16,635 31,201 14,620

Marketing and selling expenses (9,563) (17,755) (8,305) General and administrative expenses (1,789) (3,466) (1,679) Income/(loss) from joint ventures and associates 8 12 23 12

Proﬁt from recurring operations 24 5,295 10,003 4,648

Other operating income and expenses 25 (54) (126) (70)

Operating proﬁt 5,241 9,877 4,578

Cost of net ﬁnancial debt (51) (117) (56) Interest on lease liabilities (145) - - Other ﬁnancial income and expenses (9) (271) 34

Net ﬁnancial income/(expense) 26 (205) (388) (22)

Income taxes 27 (1,431) (2,499) (1,264)

Net profit before minority interests 3,605 6,990 3,292

Minority interests 18 (337) (636) (288)

Net profit, Group share 3,268 6,354 3,004

Basic Group share of net earnings per share (EUR) 28 6.49 12.64 5.97 Number of shares on which the calculation is based 503,611,097 502,825,461 502,816,581

Diluted Group share of net earnings per share (EUR) 28 6.48 12.61 5.96 Number of shares on which the calculation is based 504,554,724 503,918,140 504,102,671

22 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF COMPREHENSIVE GAINS AND LOSSES

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 June 30, 2018

Net profit before minority interests 3,605 6,990 3,292

Translation adjustments 101 274 133 Amounts transferred to income statement 1 (1) - Tax impact 4 15 7

16.5, 18 106 288 140

Change in value of hedges of future foreign currency cash flows (12) 3 (7) Amounts transferred to income statement 25 (279) (266) Tax impact (3) 79 79

10 (197) (194)

Change in value of the cost of hedging instruments (81) (271) (159) Amounts transferred to income statement 109 148 56 Tax impact (8) 31 25

20 (92) (78)

Gains and losses recognized in equity, transferable to income statement 136 (1) (132)

Change in value of vineyard land 6 - 8 - Amounts transferred to consolidated reserves - - - Tax impact - (2) -

- 6 -

Employee benefit commitments: change in value resulting from actuarial gains and losses (78) 28 - Tax impact 25 (5) -

(53) 23 -

Gains and losses recognized in equity, not transferable to income statement (53) 29 -

Comprehensive income 3,688 7,018 3,160 Minority interests (338) (681) (303)

Comprehensive income, Group share 3,350 6,337 2,857

Interim Financial Report - Six-month period ended June 30, 2019 23 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEET

ASSETS (EUR millions) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Brands and other intangible assets 3 16,893 17,254 17,026 Goodwill 4 16,406 13,727 14,026 Property, plant and equipment 6 16,225 15,112 14,162 Right-of-use assets 7 12,138 - - Investments in joint ventures and associates 8 715 638 640 Non-current available for sale financial assets 9 910 1,100 883 Other non-current assets 10 1,454 986 1,062 Deferred tax 2,077 1,932 1,775

Non-current assets 66,818 50,749 49,574

Inventories and work in progress 11 13,561 12,485 11,883 Trade accounts receivable 12 3,004 3,222 2,738 Income taxes 334 366 463 Other current assets 13 3,208 2,868 2,860 Cash and cash equivalents 15 3,999 4,610 4,222

Current assets 24,106 23,551 22,166

Total assets 90,924 74,300 71,740

LIABILITIES AND EQUITY (EUR millions) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Equity, Group share 16.1 33,678 32,293 29,990 Minority interests 18 1,712 1,664 1,492

Equity 35,390 33,957 31,482

Long-term borrowings 19 5,588 6,005 6,692 Non-current lease liabilities 7 10,139 - - Non-current provisions and other liabilities 20 3,647 3,188 3,381 Deferred tax 5,123 5,036 4,958 Purchase commitments for minority interests’ shares 21 9,989 9,281 9,461

Non-current liabilities 34,486 23,510 24,492

Short-term borrowings 19 7,890 5,027 5,659 Current lease liabilities 7 2,029 - - Trade accounts payable 22.1 5,163 5,314 4,608 Income taxes 800 538 651 Current provisions and other liabilities 22.2 5,166 5,954 4,848

Current liabilities 21,048 16,833 15,766

Total liabilities and equity 90,924 74,300 71,740

24 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(EUR millions) Number Share Share Treasury Cumulative Revaluation reserves Net profit Total equity of shares capital premium shares translation and other account adjustment Available Hedges of Vineyard Employee reserves Group Minority Total for sale future foreign land benefit share interests financial currency cash commit- assets flows and cost ments of hedging Notes 16.1 16.1 16.3 16.5 18 As of December 31, 2017 507,042,596 152 2,614 (530) 354 - 130 1,114 (133) 25,268 28,969 1,408 30,377 Gains and losses recognized in equity 219 - (259) 3 20 - (17) 45 28 Net profit 6,354 6,354 636 6,990 Comprehensive income - - - 219 - (259) 3 20 6,354 6,337 681 7,018 Stock option plan-related expenses 78 78 4 82 (Acquisition)/disposal of treasury shares (256) (26) (282) - (282) Exercise of LVMH share subscription options 762,851 49 - 49 - 49 Retirement of LVMH shares (2,775,952) (365) 365 - - - - Capital increase in subsidiaries - - 50 50 Interim and final dividends paid (2,715) (2,715) (345) (3,060) Changes in control of consolidated entities (9) (9) 41 32 Acquisition and disposal of minority interests’ shares (22) (22) (19) (41) Purchase commitments for minority interests’ shares (112) (112) (156) (268) As of December 31, 2018 505,029,495 152 2,298 (421) 573 - (129) 1,117 (113) 28,816 32,293 1,664 33,957 Impact of changes in accounting standards (a) (29) (29) - (29) As of January 1, 2019 505,029,495 152 2,298 (421) 573 - (129) 1,117 (113) 28,787 32,264 1,664 33,928 Gains and losses recognized in equity 102 - 27 - (48) - 81 1 82 Net profit 3,268 3,268 337 3,605 Comprehensive income - - - 102 - 27 - (48) 3,268 3,349 338 3,687 Stock option plan-related expenses 34 34 2 36 (Acquisition)/disposal of treasury shares 10 4 14 - 14 Exercise of LVMH share subscription options 403,946 21 - 21 - 21 Retirement of LVMH shares (2,156) - - - - Capital increase in subsidiaries - - 49 49 Interim and final dividends paid (2,012) (2,012) (360) (2,372) Changes in control of consolidated entities 4 4 2 6 Acquisition and disposal of minority interests’ shares (6) (6) 2 (4) Purchase commitments for minority interests’ shares 10 10 15 25 As of June 30, 2019 505,431,285 152 2,319 (411) 675 - (102) 1,117 (161) 30,089 33,678 1,712 35,390

As of December 31, 2017 507,042,596 152 2,614 (530) 354 - 130 1,114 (133) 25,268 28,969 1,408 30,377 Gains and losses recognized in equity 97 - (244) - - - (147) 15 (132) Net proﬁt 3,004 3,004 288 3,292 Comprehensive income - - - 97 - (244) - - 3,004 2,857 303 3,160 Stock option plan-related expenses 38 38 2 40 (Acquisition)/disposal of treasury shares (80) (6) (86) - (86) Exercise of LVMH share subscription options 760,695 49 - 49 - 49 Retirement of LVMH shares (2,015,257) (331) 331 - - - - Capital increase in subsidiaries - - 25 25 Interim and ﬁnal dividends paid (1,709) (1,709) (287) (1,996) Changes in control of consolidated entities - - (2) (2) Acquisition and disposal of minority interests’ shares (69) (69) (14) (83) Purchase commitments for minority interests’ shares (59) (59) 57 (2) As of June 30, 2018 505,788,034 152 2,332 (279) 451 - (114) 1,114 (133) 26,467 29,990 1,492 31,482

(a) The impact of changes in accounting standards arose from the application of IFRS 16 Leases as of January 1, 2019. See Note 1.2 regarding the impact of the application of IFRS 16.

Interim Financial Report - Six-month period ended June 30, 2019 25 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED CASH FLOW STATEMENT

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

I. OPERATING ACTIVITIES Operating proﬁt 5,241 9,877 4,578 (Income)/loss and dividends received from joint ventures and associates 8 (9) 5 (2) Net increase in depreciation, amortization and provisions 1,193 2,302 1,066 Depreciation of right-of-use assets 7.1 1,171 - - Other adjustments and computed expenses (197) (219) (178)

Cash from operations before changes in working capital 7,399 11,965 5,464 Cost of net ﬁnancial debt: interest paid (37) (113) (73) Lease liabilities: interest paid (109) - - Tax paid (1,191) (2,275) (907) Change in working capital 15.2 (1,873) (1,087) (1,323)

Net cash from operating activities 4,189 8,490 3,161

II. INVESTING ACTIVITIES Operating investments 15.3 (1,423) (3,038) (1,204) Purchase and proceeds from sale of consolidated investments 2 (1,885) (17) (5) Dividends received 1 18 18 Tax paid related to non-current available for sale ﬁnancial assets and consolidated investments - (2) (1) Purchase and proceeds from sale of non-current available for sale ﬁnancial assets 9 (81) (400) (47)

Net cash from/(used in) investing activities (3,388) (3,439) (1,239)

III. FINANCING ACTIVITIES Interim and ﬁnal dividends paid 15.4 (2,412) (3,090) (2,039) Purchase and proceeds from sale of minority interests (9) (236) (72) Other equity-related transactions 15.4 82 (205) (23) Proceeds from borrowings 19 2,988 1,529 1,571 Repayment of borrowings 19 (956) (2,174) (822) Repayment of lease liabilities 7.2 (1,071) - - Purchase and proceeds from sale of current available for sale ﬁnancial assets 14 - (147) (131)

Net cash from/(used in) ﬁnancing activities (1,378) (4,323) (1,516)

IV. EFFECT OF EXCHANGE RATE CHANGES 15 67 29

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (I+II+III+IV) (562) 795 435

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 15.1 4,413 3,618 3,618 CASH AND CASH EQUIVALENTS AT END OF PERIOD 15.1 3,851 4,413 4,053

TOTAL TAX PAID (1,256) (2,314) (951)

Alternative performance measure The following table presents the reconciliation between “Net cash from operating activities” and “Operating free cash flow” for the periods presented:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Net cash from operating activities 4,189 8,490 3,161 Operating investments (1,423) (3,038) (1,204) Repayment of lease liabilities (1,071) - -

Operating free cash ﬂow (a) 1,695 5,452 1,957

(a) Under IFRS 16, fixed lease payments are treated partly as interest payments and partly as principal repayments. For its own operational management purposes, the Group treats all lease payments as components of its “Operating free cash flow”, whether the lease payments made are fixed or variable. In addition, for its own operational management purposes, the Group treats operating investments as components of its “Operating free cash flow”.

26 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d SELECTED NOTES TO THE CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES 28 2. CHANGES IN OWNERSHIP INTERESTS IN CONSOLIDATED ENTITIES 30 3. BRANDS, TRADE NAMES AND OTHER INTANGIBLE ASSETS 31 4. GOODWILL 32 5. IMPAIRMENT TESTING OF INTANGIBLE ASSETS WITH INDEFINITE USEFUL LIVES 32 6. PROPERTY, PLANT AND EQUIPMENT 32 7. LEASES 34 8. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES 35 9. NON-CURRENT AVAILABLE FOR SALE FINANCIAL ASSETS 36 10. OTHER NON-CURRENT ASSETS 36 11. INVENTORIES AND WORK IN PROGRESS 36 12. TRADE ACCOUNTS RECEIVABLE 37 13. OTHER CURRENT ASSETS 38 14. CURRENT AVAILABLE FOR SALE FINANCIAL ASSETS 38 15. CASH AND CHANGE IN CASH 38 16. EQUITY 40 17. STOCK OPTION AND SIMILAR PLANS 42 18. MINORITY INTERESTS 43 19. BORROWINGS 44 20. PROVISIONS AND OTHER NON-CURRENT LIABILITIES 46 21. PURCHASE COMMITMENTS FOR MINORITY INTERESTS’ SHARES 47 22. TRADE ACCOUNTS PAYABLE AND OTHER CURRENT LIABILITIES 47 23. FINANCIAL INSTRUMENTS AND MARKET RISK MANAGEMENT 48 24. SEGMENT INFORMATION 51 25. OTHER OPERATING INCOME AND EXPENSES 54 26. NET FINANCIAL INCOME/(EXPENSE) 55 27. INCOME TAXES 55 28. EARNINGS PER SHARE 56 29. OFF-BALANCE SHEET COMMITMENTS 56 30. EXCEPTIONAL EVENTS AND LITIGATION 57 31. RELATED-PARTY TRANSACTIONS 57 32. SUBSEQUENT EVENTS 57

Interim Financial Report - Six-month period ended June 30, 2019 27 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

1. ACCOUNTING POLICIES

1.1 General framework and environment

The condensed consolidated financial statements for the first The interim financial statements are prepared using the same half of 2019 were approved by the Board of Directors on July 24, accounting principles and policies as those applied for the 2019. These financial statements were prepared in accordance preparation of the annual financial statements, with the exception with IAS 34 relating to the preparation of interim financial of the determination of the income tax rate, which is calculated statements, as well as international accounting standards and based on the expected rate for the fiscal year. Moreover, comparability interpretations (IAS/IFRS) adopted by the European Union and of the Group’s half-year and annual financial statements may be in force on June 30, 2019; these standards and interpretations affected by the seasonal nature of the Group’s businesses, which were applied consistently to the periods presented. achieve a higher level of revenue during the second half of the year than in the first half (see Note 24 “Segment information”).

1.2 Changes in the accounting framework applicable to LVMH

Standards, amendments and interpretations it encounters a wide range of different legal conditions when for which application became mandatory in 2019 entering into contracts. The lease term generally used to calculate the liability is the term of the initially negotiated lease, not The Group applies IFRS 16 Leases as of January 1, 2019. taking into account any early termination or extension options, When entering into a lease involving fixed payments, this except in special circumstances. No lease liabilities are recognized standard requires that a liability be recognized in the balance if LVMH and the lessor can cancel their commitment with sheet, measured at the discounted present value of future less than 12 months’ notice. The discount rate is determined payments and offset against a right-of-use asset depreciated over for each lease using the incremental borrowing rate of the the lease term. subsidiary entering into the lease. Given the structure of the Group’s financing – virtually all of which is held or guaranteed The Group applied what is known as the “modified retrospective” by LVMH SE – in practice, this incremental borrowing rate transition method, under which a liability is recognized at the is generally determined as the total of the risk-free rate for the transition date for an amount equal to the present value of lease currency, with respect to the duration, and the Group’s the residual lease payments alone, offset against a right-of-use credit risk for this same reference currency and term. asset adjusted for the amount of prepaid lease payments or amounts recognized within accrued expenses; all the impacts of Leasehold rights, previously recognized within “Intangible the transition were deducted from equity. The standard provided assets”, as well as “Property, plant and equipment” related to for various simplification measures during the transition phase: restoration obligations for leased facilities, are now presented in particular, the Group opted to apply the measures allowing within “Right-of-use assets” and subject to depreciation according it to exclude leases with a residual term of less than twelve months to consistent principles. and leases of low-value assets, to continue applying the same The Group has implemented a dedicated IT solution to gather treatment to leases that qualified as finance leases under IAS 17, lease data and run the calculations required by the standard. and not to capitalize costs directly related to signing leases. Most leases are related to the Group’s retail premises (see Note 7 The amount of the liability depends to a large degree on the for details). Such leases are actively managed and directly linked assumptions used for the lease term and, to a lesser extent, the to the conduct of Maisons’ business and their distribution discount rate. The Group’s extensive geographic coverage means strategy.

28 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

The following table presents the impact of the application of IFRS 16 on the opening balance sheet:

(EUR millions) As of Impact of the As of Dec. 31, 2018 transition to Jan. 1, 2019 IFRS16

Brands, goodwill and intangible assets 30,981 (379) 30,602 Property, plant and equipment 15,112 (355) 14,757 Right-of-use assets - 11,867 11,867 Other non-current assets 4,656 (13) 4,643 Current assets 23,551 (53) 23,498

Total assets 74,300 11,067 85,367

Equity, Group share 32,293 (29) 32,264 Minority interests 1,664 - 1,664 Non-current lease liabilities - 9,679 9,679 Provisions and other non-current liabilities 23,510 (343) 23,167 Current lease liabilities - 2,149 2,149 Other current liabilities 16,833 (389) 16,444

Total liabilities and equity 74,300 11,067 85,367

“Lease liabilities” totaled 11.8 billion euros as of January 1, 2019 The following table provides details on the difference between and comprised: lease commitments presented in accordance with IAS 17 as of December 31, 2018, and lease liabilities measured according to – lease liabilities newly recognized in respect of operating leases IFRS 16 as of January 1, 2019: in effect as of January 1, 2019 for 11.5 billion euros, including 9.4 billion euros for long-term leases; (EUR millions) – finance lease liabilities for 0.3 billion euros, recognized under “Borrowings” as of December 31, 2018. Commitments given for operating leases and concessions as of December 31, 2018 12,573 The average discount rate for lease liabilities at the transition date was 2.2%. Minimum payments on ﬁnance leases as of December 31, 2018 830 “Right-of-use assets” totaled 11.9 billion euros as of January 1, 2019 Impact of discounting (1,953) and comprised: Other 378

– assets corresponding to newly recognized lease liabilities for Lease liabilities as of January 1, 2019 11.5 billion euros; under IFRS 16 11,828 – the carrying amount of property, plant and equipment “Other” mainly comprises the recognition of optional periods covered by finance leases for 0.3 billion euros, recognized that were not covered by the definition of off-balance sheet within “Property, plant and equipment” as of December 31, commitments presented in accordance with IAS 17. 2018; The impact of applying IFRS 16 on profit from recurring – the carrying amount of leasehold rights for 0.4 billion euros, operations and net profit is not significant. recognized within “Intangible assets” as of December 31, 2018; Under the modified retrospective transition method, the – various lease-related current receivables and payables recognized standard prohibits the restatement of comparative fiscal years. as of December 31, 2018 and reclassified within “Right-of-use Given the importance of leases to the Group’s activities, and in assets”, representing a net liability of -0.3 billion euros, in order to present consistent performance indicators, independently particular liabilities related to the recognition of leases on a of the fixed or variable nature of lease payments, specific indicators straight-line basis. are used for internal performance monitoring requirements and financial communication purposes; in particular, capitalized fixed lease payments are deducted in their entirety from cash flow in order to calculate the aggregate entitled “Operating free cash flow”. In correlation, the liability for capitalized leases is excluded from the definition of net financial debt.

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The Group applies IFRIC 23 Uncertainty over Income Tax simplified in order to make these statements easier to understand. Treatments as of January 1, 2019. It did not have any significant This included separating “Purchase commitments for minority impact on the Group’s financial statements. interests’ shares” from other balance sheet liabilities, while other items were grouped together, with detailed breakdowns inserted As a result of the application of new standards that took effect in additional notes. on January 1, 2019 – IFRS 16 in particular – the presentation of the balance sheet and cash flow statement was modified and

2. CHANGES IN OWNERSHIP INTERESTS IN CONSOLIDATED ENTITIES

Belmond

On April 17, 2019, pursuant to the transaction agreement announced The amounts presented in the table above are taken from Belmond’s on December 14, 2018 and approved by Belmond’s shareholders unaudited financial statements at the date of acquisition of the on February 14, 2019, LVMH acquired, for cash, all the Class A controlling interest; there has been no revaluation. The main shares of Belmond Ltd at a unit price of 25 US dollars, for a items that may be subject to revaluation are real estate assets total of 2.2 billion US dollars. After taking into account the and the Belmond brand. shares acquired on the market in December 2018, the carrying The carrying amount of shares held as of the date of acquisition amount of Belmond shares held came to 2.3 billion euros. of the controlling interest includes shares acquired in 2018 for Following this acquisition, Belmond’s Class A shares were no 274 million euros. longer listed on the New York Stock Exchange. During the six-month period, the Belmond acquisition generated Belmond, which has locations in 24 countries, owns and operates an outflow of 1,878 million euros, net of cash acquired in the an exceptional portfolio of very high-end hotels and travel amount of 101 million euros. Following the acquisition of the experiences in the world’s most desirable, prestigious destinations. controlling interest, Belmond’s long-term bank borrowings were The following table details the provisional allocation of the repaid in the amount of 560 million euros. purchase price paid by LVMH on April 17, 2019, the date of No components of Belmond’s activities were recorded in LVMH’s acquisition of the controlling interest: 2019 interim consolidated financial statements. For 2018 as a whole, Belmond had consolidated revenue of 577 million US (EUR millions) Provisional purchase price allocation dollars, and an operating profit of 12 million US dollars.

Brand and other intangible assets 6 Property, plant and equipment 1,119 Other current and non-current assets 202 Net ﬁnancial debt (586) Deferred tax (80) Current and non-current liabilities (335) Minority interests (1)

Net assets acquired 325

Provisional goodwill 1,928

Carrying amount of shares held as of April 17, 2019 2,253

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3. BRANDS, TRADE NAMES AND OTHER INTANGIBLE ASSETS

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Gross Amortization Net Net Net and impairment

Brands 14,317 (724) 13,593 13,596 13,523 Trade names 3,873 (1,596) 2,277 2,265 2,229 License rights 94 (83) 11 13 14 Software, websites 2,030 (1,478) 552 544 457 Other 1,057 (597) 460 836 803

Total 21,371 (4,478) 16,893 17,254 17,026

As of December 31 and June 30, 2018, “Other intangible assets” included leasehold rights. As from January 1, 2019, in accordance with IFRS 16, leasehold rights are now presented within “Right-of-use assets” (see Note 7). Movements during the six-month period in the net amounts of brands, trade names and other intangible assets were as follows:

Gross value Brands Trade names Software, Other intangible Total (EUR millions) websites assets

As of December 31, 2018 14,292 3,851 1,903 1,964 22,010

Impact of changes in accounting standards (a) - - - (770) (770)

As of January 1, 2019, after restatement 14,292 3,851 1,903 1,194 21,240

Acquisitions - - 57 144 201 Disposals and retirements - - (13) (102) (115) Changes in the scope of consolidation - - 8 - 8 Translation adjustment 25 22 5 5 57 Reclassiﬁcations - - 70 (90) (20)

As of June 30, 2019 14,317 3,873 2,030 1,151 21,371

Amortization Brands Trade names Software, Other intangible Total and impairment (EUR millions) websites assets

As of December 31, 2018 (696) (1,586) (1,359) (1,115) (4,756)

Impact of changes in accounting standards (a) - - - 391 391

As of January 1, 2019, after restatement (696) (1,586) (1,359) (724) (4,365)

Amortization expense (5) - (128) (67) (200) Impairment expense (20) - - 5 (15) Disposals and retirements - - 13 102 115 Changes in the scope of consolidation - - (1) - (1) Translation adjustment (3) (10) (3) (3) (19) Reclassiﬁcations - - - 7 7

As of June 30, 2019 (724) (1,596) (1,478) (680) (4,478)

Carrying amount as of June 30, 2019 13,593 2,277 552 471 16,893

(a) The impact of changes in accounting standards arose from the application of IFRS 16 Leases as of January 1, 2019. See Note 1.2.

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4. GOODWILL

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Net Net Goodwill arising on consolidated investments 12,350 (1,752) 10,598 8,654 8,514 Goodwill arising on purchase commitments for minority interests’ shares 5,808 - 5,808 5,073 5,512 Total 18,158 (1,752) 16,406 13,727 14,026

Changes in net goodwill during the periods presented break down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Net Net As of January 1 15,462 (1,735) 13,727 13,837 13,837 Changes in the scope of consolidation 1,935 - 1,935 45 (35) Changes in purchase commitments for minority interests’ shares 733 - 733 (126) 248 Changes in impairment - (11) (11) (100) (61) Translation adjustment 28 (5) 23 71 37 As of period-end 18,158 (1,752) 16,406 13,727 14,026

Changes in the scope of consolidation mainly resulted from the acquisition of Belmond. See Note 2. See also Note 21 for goodwill arising on purchase commitments for minority interests’ shares.

5. IMPAIRMENT TESTING OF INTANGIBLE ASSETS WITH INDEFINITE USEFUL LIVES

Brands, trade names and other intangible assets with indefinite useful lives as well as the goodwill arising on acquisition were subject to annual impairment testing as of December 31, 2018. No significant impairment expense was recognized during the first half of 2019, as no events likely to lead to a material loss in value occurred during the period.

6. PROPERTY, PLANT AND EQUIPMENT

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Gross Depreciation Net Net Net and impairment Land 2,779 (85) 2,694 2,838 2,456 Vineyard land and producing vineyards (b) 2,587 (114) 2,473 2,473 2,420 Buildings 5,280 (2,040) 3,240 2,292 2,327 Investment property 639 (37) 602 602 534 Leasehold improvements, machinery and equipment 13,207 (9,094) 4,113 4,078 3,882 Assets in progress 1,432 (2) 1,430 1,237 1,034 Other property, plant and equipment 2,210 (537) 1,673 1,592 1,509

Total 28,134 (11,909) 16,225 15,112 14,162

Of which: historical cost of vineyard land 577 - 577 576 533

(a) The ﬁnancial statements as of December 31 and June 30, 2018 have not been restated to reﬂect the application of IFRS 16 Leases. See Note 1.2 regarding the impact of the application of IFRS 16. (b) Almost all of the carrying amount of “Vineyard land and producing vineyards” corresponds to vineyard land.

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Changes in property, plant and equipment during the period broke down as follows:

Gross value Vineyard land Land and Investment Leasehold improvements, Assets in Other Total (EUR millions) and producing buildings property machinery and equipment progress property, vineyards plant and Stores Production, Other equipment logistics As of December 31, 2018 2,584 7,051 637 8,632 2,756 1,351 1,238 2,074 26,323

Impact of changes in accounting standards (a) - (395) - (149) (50) (32) (3) (1) (630)

As of January 1, after restatement 2,584 6,656 637 8,483 2,706 1,319 1,235 2,073 25,693

Acquisitions 3 56 1 241 66 37 650 63 1,117 Change in the market value of vineyard land ------Disposals and retirements - (18) (24) (201) (32) (30) (16) (9) (330) Changes in the scope of consolidation - 1,172 - 261 - - - 89 1,522 Translation adjustment 1 25 1 64 5 5 1 4 106 Other movements, including transfers (1) 168 24 176 66 41 (438) (10) 26

As of June 30, 2019 2,587 8,059 639 9,024 2,811 1,372 1,432 2,210 28,134

Depreciation Vineyard land Land and Investment Leasehold improvements, Assets in Other Total and impairment and producing buildings property machinery and equipment progress property, (EUR millions) vineyards plant and Stores Production, Other equipment logistics As of December 31, 2018 (111) (1,921) (35) (5,907) (1,810) (944) (1) (482) (11,211)

Impact of changes in accounting standards (a) - 135 - 88 28 23 (1) 2 275

As of January 1, after restatement (111) (1,786) (35) (5,819) (1,782) (921) (2) (480) (10,936)

Depreciation expense (3) (90) (2) (478) (88) (67) - (33) (761) Impairment expense - - - 1 - - (15) - (14) Disposals and retirements - 17 - 203 32 28 14 10 304 Changes in the scope of consolidation - (227) - (141) - - - (35) (403) Translation adjustment - (9) - (42) (4) (3) - (2) (60) Other movements, including transfers - (30) - 4 (15) (2) 1 3 (39)

As of June 30, 2019 (114) (2,125) (37) (6,272) (1,857) (965) (2) (537) (11,909)

Carrying amount as of June 30, 2019 2,473 5,934 602 2,752 954 407 1,430 1,673 16,225

(a) The impact of changes in accounting standards arose from the application of IFRS 16 Leases as of January 1, 2019. See Note 1.2.

“Other property, plant and equipment” includes in particular Changes in the scope of consolidation mainly resulted from the works of art owned by the Group. the acquisition of Belmond. See Note 2. Purchases of property, plant and equipment mainly include Translation adjustments arose mainly on property, plant and investments by the Group’s brands – notably Louis Vuitton, equipment recognized in US dollars, due to exchange rate DFS, Sephora, Celine and Christian Dior Couture – in their fluctuations against the euro between the beginning and end retail networks. They also included investments related to the of the period. La Samaritaine project as well as investments by the champagne houses and Hennessy in their production equipment.

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7. LEASES

7.1 Right-of-use assets

Right-of-use assets break down as follows, by type of underlying asset:

(EUR millions) June 30, 2019 January 1, 2019

Gross Depreciation Net Net and impairment

Stores 10,597 (999) 9,598 9,472 Ofﬁces 1,605 (162) 1,443 1,332 Other 789 (64) 725 718

Capitalized ﬁxed lease payments 12,991 (1,225) 11,766 11,522

Leasehold rights 751 (379) 372 345

Total 13,742 (1,604) 12,138 11,867

The net amounts of right-of-use assets changed as follows during the half-year period:

Gross value Capitalized ﬁxed lease payments Leasehold Total (EUR millions) rights Stores Ofﬁces Other Total

As of January 1, 2019 9,531 1,365 728 11,624 673 12,297

New leases entered into 918 279 66 1,263 42 1,305 Changes in assumptions 87 (5) (2) 80 - 80 Leases ended or canceled (101) (6) (10) (117) (22) (139) Changes in scope of consolidation 56 - - 56 2 58 Translation adjustment 76 8 6 90 2 92 Other movements, including transfers 30 (36) 1 (5) 54 49

As of June 30, 2019 10,597 1,605 789 12,991 751 13,742

Depreciation and impairment Capitalized ﬁxed lease payments Leasehold Total (EUR millions) rights Stores Ofﬁces Other Total

As of January 1, 2019 (59) (33) (10) (102) (328) (430)

Depreciation and amortization expense (942) (138) (56) (1,136) (26) (1,162) Impairment expense - (6) - (6) (3) (9) Leases ended or canceled 22 2 2 26 8 34 Changes in the scope of consolidation - - - - (5) (5) Translation adjustment 2 - - 2 (1) 1 Other movements, including transfers (22) 13 - (9) (24) (33)

As of June 30, 2019 (999) (162) (64) (1,225) (379) (1,604)

Carrying amount as of June 30, 2019 9,598 1,443 725 11,766 372 12,138

“New leases entered into” mainly concern store leases, in particular for Sephora, Christian Dior Couture, DFS and Louis Vuitton. They also include leases of office space, mainly for Parfums Christian Dior.

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7.2 Lease liabilities

Lease liabilities break down as follows:

(EUR millions) June 30, 2019 January 1, 2019

Non-current lease liabilities 10,139 9,679 Current lease liabilities 2,029 2,149

Total 12,168 11,828

The change in lease liabilities during the half-year period breaks down as follows:

(EUR millions) Stores Ofﬁces Other Total

As of January 1, 2019 9,692 1,420 716 11,828

New leases entered into 907 277 65 1,249 Principal repayments (892) (122) (49) (1,063) Change in accrued interest 30 4 1 35 Leases ended or canceled (79) (4) (8) (91) Changes in assumptions 86 (5) (2) 79 Changes in the scope of consolidation 56 - - 56 Translation adjustment 79 8 6 93 Other movements, including transfers 26 (45) 1 (18)

As of June 30, 2019 9,905 1,533 730 12,168

8. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Of which Net Of which Net Of which joint joint joint arrangements arrangements arrangements Share of net assets of joint ventures and associates as of January 1 638 - 638 278 639 273 639 273

Share of net profit (loss) for the period 12 - 12 9 23 12 12 7 Dividends paid (3) - (3) - (28) (9) (10) - Changes in the scope of consolidation 58 - 58 58 (10) 2 (11) 2 Capital increases subscribed 3 - 3 2 3 1 2 1 Translation adjustment 3 - 3 - 7 - 3 - Other, including transfers 4 - 4 4 4 (1) 5 1

Share of net assets of joint ventures and associates as of period-end 715 - 715 351 638 278 640 284

Changes in the scope of consolidation mainly resulted from the acquisition of Belmond. See Note 2.

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9. NON-CURRENT AVAILABLE FOR SALE FINANCIAL ASSETS

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

As of January 1 1,100 789 789

Acquisitions 117 450 92 Disposals at net realized value (40) (45) (25) Changes in market value (a) 7 (101) 17 Changes in the scope of consolidation - - - Translation adjustment 2 16 10 Reclassifications (276) (9) -

As of period-end 910 1,100 883

(a) Recognized within “Net ﬁnancial income/(expense)”.

Reclassifications resulted from the acquisition of a controlling interest in Belmond, with the shares acquired in 2018 for 274 million euros being included in the carrying amount of the investment held in Belmond. See Note 2.

10. OTHER NON-CURRENT ASSETS

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Warranty deposits 408 379 348 Derivatives (b) 696 257 371 Loans and receivables 305 303 306 Other 45 47 37

Total 1,454 986 1,062

11. INVENTORIES AND WORK IN PROGRESS

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Net Net

Wines and eaux-de-vie in the process of aging 4,845 (11) 4,834 4,784 4,541 Other raw materials and work in progress 2,410 (439) 1,971 1,700 1,620

7,255 (450) 6,805 6,484 6,161

Goods purchased for resale 2,526 (230) 2,296 2,091 1,966 Finished products 5,421 (961) 4,460 3,910 3,756

7,947 (1,191) 6,756 6,001 5,722

Total 15,202 (1,641) 13,561 12,485 11,883

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The net change in inventories for the periods presented breaks down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Net Net

As of January 1 14,069 (1,584) 12,485 10,888 10,888

Change in gross inventories 1,210 - 1,210 1,722 1,038 Impact of provision for returns (a) (4) - (4) 7 - Impact of marking harvests to market 4 - 4 16 5 Changes in provision for impairment - (217) (217) (285) (138) Changes in the scope of consolidation 19 - 19 25 17 Translation adjustment 78 (15) 63 109 68 Other, including reclassifications (174) 175 1 3 5

As of period-end 15,202 (1,641) 13,561 12,485 11,883

(a) See Note 1.25 to the 2018 consolidated ﬁnancial statements.

The impact of marking harvests to market on Wines & Spirits’ cost of sales and value of inventory is as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Impact of marking the period’s harvest to market 11 41 14 Impact of inventory sold during the period (7) (25) (9)

Net impact on cost of sales of the period 4 16 5

12. TRADE ACCOUNTS RECEIVABLE

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Trade accounts receivable, nominal amount 3,081 3,302 2,812 Provision for impairment (77) (78) (74) Provision for product returns - (2) -

Net amount 3,004 3,222 2,738

(a) See Note 1.25 to the 2018 consolidated ﬁnancial statements.

The change in trade accounts receivable for the periods presented breaks down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Gross Impairment Net Net Net

As of January 1 3,300 (78) 3,222 2,736 2,736

Changes in gross receivables (285) - (285) 179 (304) Changes in provision for impairment - 2 2 (1) 3 Changes in provision for product returns (a) - - - 7 - Changes in the scope of consolidation 34 - 34 5 4 Translation adjustment 36 - 36 24 26 Reclassifications (4) (1) (5) 272 273

As of period-end 3,081 (77) 3,004 3,222 2,738

(a) See Note 1.25 to the 2018 consolidated ﬁnancial statements.

The trade accounts receivable balance is comprised essentially of receivables from wholesalers or agents, who are limited in number and with whom the Group maintains ongoing relationships for the most part.

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13. OTHER CURRENT ASSETS

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Current available for sale ﬁnancial assets (b) 788 666 728 Derivatives (c) 159 123 145 Tax accounts receivable, excluding income taxes 994 895 794 Advances and payments on account to vendors 190 216 169 Prepaid expenses 513 430 495 Other receivables 564 538 529

Total 3,208 2,868 2,860

14. CURRENT AVAILABLE FOR SALE FINANCIAL ASSETS

The net value of current available for sale financial assets changed as follows during the periods presented:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

As of January 1 666 515 515

Acquisitions - 311 191 Disposals at net realized value - (164) (58) Changes in market value (a) 122 3 79 Changes in the scope of consolidation - - - Translation adjustment - 1 1 Reclassifications - - -

As of period-end 788 666 728

Of which: Historical cost of current available for sale ﬁnancial assets 575 576 505

(a) Recognized within “Net ﬁnancial income/(expense)”.

15. CASH AND CHANGE IN CASH

15.1 Cash and cash equivalents

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Term deposits (less than 3 months) 277 654 550 SICAV and FCP funds 122 192 409 Ordinary bank accounts 3,600 3,764 3,263

Cash and cash equivalents per balance sheet 3,999 4,610 4,222

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The reconciliation between cash and cash equivalents as shown in the balance sheet and net cash and cash equivalents appearing in the cash flow statement is as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Cash and cash equivalents 3,999 4,610 4,222 Bank overdrafts (148) (197) (169)

Net cash and cash equivalents per cash ﬂow statement 3,851 4,413 4,053

15.2 Change in working capital

The change in working capital breaks down as follows for the periods presented:

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 June 30, 2018

Change in inventories and work in progress 11 (1,210) (1,722) (1,038) Change in trade accounts receivable 12 285 (179) 304 Change in balance of amounts owed to customers (31) 8 (22) Change in trade accounts payable 22.1 (159) 715 35 Change in other receivables and payables (758) 91 (602)

Change in working capital (a) (1,873) (1,087) (1,323)

(a) Increase/(Decrease) in cash and cash equivalents.

15.3 Operating investments

Operating investments comprise the following elements for the periods presented:

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Purchase of intangible assets 3 (201) (537) (198) Purchase of property, plant and equipment 6 (1,117) (2,590) (946) Change in accounts payable related to fixed asset purchases (62) 137 (47) Initial direct costs (43) - -

Net cash used in purchases of fixed assets (1,423) (2,990) (1,191) Net cash from fixed asset disposals 16 10 5 Guarantee deposits paid and other cash flows related to operating investments (16) (58) (18)

Operating investments (b) (1,423) (3,038) (1,204)

15.4 Interim and ﬁnal dividends paid and other transactions related to equity

Interim and final dividends paid comprise the following elements for the periods presented:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Interim and final dividends paid by LVMH SE (2,012) (2,715) (1,709) Interim and final dividends paid to minority interests in consolidated subsidiaries (334) (339) (287) Tax paid related to interim and final dividends paid (66) (36) (43)

Interim and ﬁnal dividends paid (2,412) (3,090) (2,039)

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Other transactions related to equity comprise the following elements for the periods presented:

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 June 30, 2018

Capital increases of LVMH SE 16.2 21 49 49 Capital increase in subsidiaries 45 41 16 Acquisition and disposals of LVMH treasury shares 16.3 16 (295) (88)

Other equity-related transactions 82 (205) (23)

16. EQUITY

16.1 Equity

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Share capital 16.2 152 152 152 Share premium account 16.2 2,319 2,298 2,332 LVMH shares 16.3 (411) (421) (279) Cumulative translation adjustment 16.5 675 573 451 Revaluation reserves 854 875 867 Other reserves 26,821 22,462 23,463 Net proﬁt, Group share 3,268 6,354 3,004

Equity, Group share 33,678 32,293 29,990

16.2 Share capital and share premium account

As of June 30, 2019, the share capital consisted of 505,431,285 fully During the six-month period, 403,946 shares were issued following paid-up shares (505,029,495 shares as of December 31, 2018 and the exercise of share subscription options, which resulted in 505,788,034 as of June 30, 2018), with a par value of 0.30 euros an increase in the share capital and share premium account of per share, including 230,051,242 shares with double voting rights 21 million euros; 2,156 shares were retired. (231,834,011 as of December 31, 2018 and 230,051,242 as of June 30, 2018). Double voting rights are attached to registered shares held for more than three years.

16.3 LVMH treasury shares

The portfolio of LVMH treasury shares is allocated as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Number Amount Amount Amount

Share subscription option plans 411,450 20 20 54 Bonus share plans 1,337,476 301 302 193

Shares held for stock option and similar plans (a) 1,748,926 321 322 247

Liquidity contract 44,000 16 25 32 Shares pending retirement 270,000 74 74 -

LVMH treasury shares 2,062,926 411 421 279

(a) See Note 17 regarding stock option and similar plans.

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The market value of LVMH shares held under the liquidity contract as of June 30, 2019 amounted to 16 million euros. The portfolio movements of LVMH treasury shares during the six-month period were as follows:

(Number of shares or EUR millions) Number Amount Impact on cash

As of December 31, 2018 2,135,404 421

Share purchases (a) 226,781 69 (69) Vested bonus shares (17,322) (1) - Retirement of shares (2,156) - - Disposals at net realized value (a) (279,781) (85) 85 Gain/(loss) on disposal - 7 -

As of June 30, 2019 2,062,926 411 16

(a) Purchases and sales of LVMH shares mainly related to the management of the liquidity contract.

16.4 Dividends paid by the parent company LVMH SE

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Interim dividend for the current fiscal year (2018: 2.00 euros) - 1,010 - Impact of treasury shares - (4) -

Gross amount disbursed for the fiscal year - 1,006 -

Final dividend for the previous fiscal year (2018: 4.00 euros; 2017: 3.40 euros) 2,020 1,717 1,717 Impact of treasury shares (8) (8) (8)

Gross amount disbursed for the previous fiscal year 2,012 1,709 1,709

Total gross amount disbursed during the period (a) 2,012 2,715 1,709

(a) Excluding the impact of tax regulations applicable to the recipient.

The final dividend for fiscal year 2018 was distributed on April 29, At its meeting of July 24, 2019, the Board of Directors approved 2019 in accordance with the resolutions of the Shareholders’ the payment on December 10, 2019, of an interim dividend Meeting of April 18, 2019. of 2.20 euros per share for fiscal year 2019.

16.5 Cumulative translation adjustment

The change in “Cumulative translation adjustment” recognized within “Equity, Group share”, net of hedging effects of net assets denominated in foreign currency, breaks down as follows by currency:

(EUR millions) June 30, 2019 Change Dec. 31, 2018 June 30, 2018

US dollar 322 29 293 236 Swiss franc 680 48 632 552 Japanese yen 123 14 109 93 Hong Kong dollar 364 10 354 340 Pound sterling (112) 3 (115) (108) Other currencies (244) 6 (250) (227) Foreign currency net investment hedges (a) (458) (8) (450) (435)

Total, Group share 675 102 573 451

(a) Including: -143 million euros with respect to the US dollar (-141 million euros as of December 31, 2018 and -137 million euros as of June 30, 2018), -118 million euros with respect to the Hong Kong dollar (-117 million euros as of December 31, 2018 and as of June 30, 2018) and -200 million euros with respect to the Swiss franc (-193 million euros as of December 31, 2018 and -184 million euros as of June 30, 2018). These amounts include the tax impact.

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17. STOCK OPTION AND SIMILAR PLANS

17.1 Share subscription option plans

The number of unexercised share subscription options and the weighted average exercise price changed as follows during the periods presented:

June 30, 2019 Dec. 31, 2018 June 30, 2018

Number Weighted average Number Weighted average Number Weighted average exercise price exercise price exercise price (EUR) (EUR) (EUR)

Share subscription options outstanding as of January 1 411,088 50.86 1,180,692 59.56 1,180,692 59.56

Options expired (7,142) 50.86 (6,753) 63.98 (6,252) 65.04 Options exercised (403,946) 50.86 (762,851) 64.21 (760,695) 64.24

Share subscription options outstanding as of period-end - - 411,088 50.86 413,745 50.86

17.2 Bonus share plans

The number of non-vested shares awarded changed as follows during the periods presented:

(number of shares) June 30, 2019 Dec. 31, 2018 June 30, 2018

Non-vested shares as of January 1 1,351,978 1,395,351 1,395,351

Provisional allocations for the period - 462,281 452,804 Shares vested during the period (17,322) (459,741) (93,156) Shares expired during the period (8,678) (45,913) (20,470)

Non-vested shares as of period-end 1,325,978 1,351,978 1,734,529

Vested share allocations were settled in existing shares held.

17.3 Expense for the period

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Expense for the period for share subscription option and bonus share plans 36 82 40

No new stock option or similar plan were set up during the half-year period.

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18. MINORITY INTERESTS

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

As of January 1 1,664 1,408 1,408

Minority interests’ share of net proﬁt 337 636 288 Dividends paid to minority interests (360) (345) (287) Impact of changes in control of consolidated entities 2 41 (2) Impact of acquisition and disposal of minority interests’ shares 2 (19) (14) Capital increases subscribed by minority interests 49 50 25 Minority interests’ share in gains and losses recognized in equity 1 45 15 Minority interests’ share in stock option plan expenses 2 4 2 Impact of changes in minority interests with purchase commitments 15 (156) 57

As of period-end 1,712 1,664 1,492

The change in minority interests’ share in gains and losses recognized in equity breaks down as follows:

(EUR millions) Cumulative Hedges of future Vineyard land Revaluation Total share of translation foreign currency adjustments minority interests adjustment cash flows and of employee cost of hedging benefits

As of December 31, 2018 115 (14) 260 (33) 328

Changes during the period 4 2 - (5) 1

As of June 30, 2019 119 (12) 260 (38) 329

Minority interests are composed primarily of Diageo’s 34% stake Dividends paid to Diageo during the first half of 2019 in respect in Moët Hennessy SAS and Moët Hennessy International SAS of fiscal year 2018 amounted to 178 million euros. Net profit (“Moët Hennessy”) and the 39% stake held by Mari-Cha Group attributable to Diageo for the first half of 2019 was 166 million Ltd (formerly Search Investment Group Ltd) in DFS. Since the euros, and its share in accumulated minority interests (before 34% stake held by Diageo in Moët Hennessy is subject to a the accounting impact of the purchase commitment granted to purchase commitment, it is reclassified at the period-end within Diageo) came to 3,206 million euros as of June 30, 2019. “Purchase commitments for minority interests’ shares” under Dividends paid to Mari-Cha Group Ltd during the first half of “Other non-current liabilities” and is therefore excluded from 2019 in respect of fiscal year 2018 amounted to 99 million euros. the total amount of minority interests at the period-end. See Net profit attributable to Mari-Cha Group Ltd for the first half Notes 21 and 1.12 to the 2018 consolidated financial statements. of 2019 was 100 million euros, and its share in accumulated minority interests as of June 30, 2019 came to 1,428 million euros.

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19. BORROWINGS

19.1 Net ﬁnancial debt

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Bonds and Euro Medium-Term Notes (EMTNs) 5,360 5,593 6,287 Finance leases - 315 303 Bank borrowings 228 97 102

Long-term borrowings 5,588 6,005 6,692

Bonds and Euro Medium-Term Notes (EMTNs) 1,950 996 1,551 Commercial paper 5,077 3,174 3,290 Bank overdrafts 148 197 169 Other short-term borrowings 715 660 649

Short-term borrowings 7,890 5,027 5,659

Gross borrowings 13,478 11,032 12,351

Interest rate risk derivatives (34) (16) (33) Foreign exchange risk derivatives 154 146 112

Gross borrowings after derivatives 13,598 11,162 12,430

Current available for sale financial assets (b) (788) (666) (728) Non-current available for sale financial assets used to hedge financial debt (127) (125) (121) Cash and cash equivalents (c) (3,999) (4,610) (4,222)

Net financial debt 8,684 5,761 7,359

Belmond shares (presented within “Non-current available for sale financial assets”) (d) - (274) -

Adjusted net financial debt, excluding the acquisition of Belmond shares 8,684 5,487 7,359

(a) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 regarding the impact of the application of IFRS 16. (b) See Note 14. (c) See Note 15.1. (d) See Note 8 to the 2018 consolidated financial statements. The change in net financial debt during the period is as follows:

(EUR millions) Dec. 31, Impact of Jan. 1, 2019, Impact Translation Impact Changes in Reclas- June 30, 2018 changes in after on cash (b) adjust- of market the scope sifications 2019 accounting restatement ment value of conso- and Other standards (a) changes lidation

Long-term borrowings 6,005 (315) 5,690 466 1 16 685 (1,270) 5,588 Short-term borrowings 5,027 (26) 5,001 1,577 17 2 3 1,290 7,890

Gross borrowings 11,032 (341) 10,691 2,043 18 18 688 20 13,478

Derivatives 130 - 130 13 - (17) - (6) 120

Gross borrowings after derivatives 11,162 (341) 10,821 2,056 18 1 688 14 13,598

(a) The impact of changes in accounting standards arose from the application of IFRS 16 Leases as of January 1, 2019. See Note 1.2. (b) Including a positive impact of 2,988 million euros in respect of proceeds from borrowings and a negative impact of 956 million euros in respect of repayment of borrowings.

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Changes in the scope of consolidation were related to the During the half-year period, LVMH repaid the 300 million euros acquisition of Belmond. The bank borrowings on Belmond’s bond issued in 2014. balance sheet at the acquisition date were repaid in the amount Net financial debt does not include purchase commitments for of 560 million euros. See Note 2. minority interests (see Note 21) or lease liabilities (see Note 7). In April 2019, LVMH completed two fixed-rate bond issues totaling 1 billion euros, comprised of 300 million euros in bonds maturing in 2021 and 700 million euros in bonds maturing in 2023.

19.2 Analysis of gross borrowings by payment date and by type of interest rate

(EUR millions) Gross borrowings Impact of derivatives Gross borrowings after derivatives

Fixed Floating Total Fixed Floating Total Fixed Floating Total rate rate rate rate rate rate

Maturity: June 30, 2020 7,668 223 7,891 (113) 251 138 7,555 474 8,029 June 30, 2021 1,607 7 1,614 (415) 394 (21) 1,192 401 1,593 June 30, 2022 2,063 - 2,063 (1,301) 1,296 (5) 762 1,296 2,058 June 30, 2023 698 - 698 17 - 17 715 - 715 June 30, 2024 1,206 3 1,209 (301) 292 (9) 905 295 1,200 June 30, 2025 ------Thereafter - 3 3 - - - - 3 3

Total 13,242 236 13,478 (2,113) 2,233 120 11,129 2,469 13,598

See Note 23.3 regarding the market value of interest rate risk derivatives.

19.3 Analysis of gross borrowings by currency after derivatives

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Euro 8,541 6,445 7,637 US dollar 4,148 3,277 3,596 Swiss franc - - 171 Japanese yen 587 662 601 Other currencies 322 778 425

Total 13,598 11,162 12,430

The purpose of foreign currency borrowings is to finance the development of the Group’s activities outside the eurozone, as well as the Group’s assets denominated in foreign currency.

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20. PROVISIONS AND OTHER NON-CURRENT LIABILITIES

Non-current provisions and other liabilities comprise the following:

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Non-current provisions 1,400 1,245 1,305 Uncertain tax positions 1,204 1,185 1,257 Derivatives 587 283 386 Employee proﬁt sharing 83 89 78 Other liabilities 373 386 355

Non-current provisions and other liabilities 3,647 3,188 3,381

Provisions concern the following types of contingencies and losses:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Provisions for pensions, medical costs and similar commitments 695 605 639 Provisions for contingencies and losses 705 640 666

Non-current provisions 1,400 1,245 1,305

Provisions for pensions, medical costs and similar commitments 6 7 4 Provisions for contingencies and losses 319 362 343

Current provisions 325 369 347

Total 1,725 1,614 1,652

Changes in provisions were as follows during the half-year period:

(EUR millions) Dec. 31, Increases Amounts Amounts Changes in Other (a) June 30, 2018 used released the scope of 2019 consolidation

Provisions for pensions, medical costs and similar commitments 612 46 (36) - - 79 701 Provisions for contingencies and losses 1,002 153 (84) (36) - (11) 1,024

Total 1,614 199 (120) (36) - (68) 1,725

(a) Including the impact of translation adjustment and change in revaluation reserves.

Provisions for contingencies and losses correspond to the estimate Non-current liabilities related to uncertain tax positions included of the impact on assets and liabilities of risks, disputes (see Note 30), an estimate of the risks, disputes and actual or probable litigation or actual or probable litigation arising from the Group’s related to the income tax computation. The Group’s entities in activities; such activities are carried out worldwide, within what France and abroad may be subject to tax inspections and, in is often an imprecise regulatory framework that is different certain cases, to rectification claims from local administrations. for each country, changes over time and applies to areas ranging A liability is recognized for these rectification claims, together from product composition and packaging to relations with with any uncertain tax positions that have been identified but the Group’s partners (distributors, suppliers, shareholders in not yet officially notified, the amount of which is regularly subsidiaries, etc.). reviewed in accordance with the criteria of the application of IFRIC 23 Uncertainty over Income Tax Treatment.

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21. PURCHASE COMMITMENTS FOR MINORITY INTERESTS’ SHARES

As of June 30, 2019, purchase commitments for minority interests’ Moët Hennessy SAS and Moët Hennessy International SAS shares mainly include the put option granted by LVMH to (“Moët Hennessy”) hold the LVMH group’s investments in the Diageo plc for its 34% share in Moët Hennessy, with six months’ Wines & Spirits businesses, with the exception of the equity advance notice and for 80% of the fair value of Moët Hennessy investments in Château d’Yquem, Château Cheval Blanc, Clos des at the exercise date of the option. This option may be exercised Lambrays and Colgin Cellars, and excluding certain champagne at any time subject to a six-month notice period. The fair value vineyards. of this commitment was calculated by applying the share price Purchase commitments for minority interests’ shares also include multiples of comparable firms to Moët Hennessy’s consolidated commitments relating to minority shareholders in Loro Piana operating results. (15%), Rimowa (20%), and distribution subsidiaries in various countries, mainly in the Middle East.

22. TRADE ACCOUNTS PAYABLE AND OTHER CURRENT LIABILITIES

22.1 Trade accounts payable

The change in trade accounts payable for the periods presented breaks down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

As of December 31 5,314 4,539 4,539

Impact of changes in accounting standards (108) - -

As of January 1, after restatement 5,206 4,539 4,539

Change in trade accounts payable (159) 715 35 Changes in amounts owed to customers (31) 8 (22) Changes in the scope of consolidation 98 7 29 Translation adjustment 36 49 33 Reclassiﬁcations 13 (4) (6)

As of period-end 5,163 5,314 4,608

22.2 Current provisions and other liabilities

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Current provisions (b) 325 369 347 Derivatives (c) 213 166 79 Employees and social institutions 1,395 1,668 1,291 Employee proﬁt sharing 59 105 57 Taxes other than income taxes 623 685 523 Advances and payments on account from customers 392 398 367 Provision for product returns (d) 316 356 288 Deferred payment for non-current assets 590 646 500 Deferred income 274 273 260 Other liabilities 979 1,288 1,136

Total 5,166 5,954 4,848

(a) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 regarding the impact of the application of IFRS 16. (b) See Note 20. (c) See Note 23. (d) See Note 1.25 to the 2018 consolidated financial statements.

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23. FINANCIAL INSTRUMENTS AND MARKET RISK MANAGEMENT

23.1 Organization of foreign exchange, interest rate and equity market risk management

Financial instruments are mainly used by the Group to hedge The backbone of this organization is an integrated information risks arising from Group activity and protect its assets. system which allows hedging transactions to be monitored quickly. The management of foreign exchange and interest rate risk, in addition to transactions involving shares and financial instruments, The Group’s hedging strategy is presented to the Audit is centralized. Committee. Hedging decisions are made according to an established process that includes regular presentations to the The Group has implemented a stringent policy and rigorous Group’s Executive Committee and detailed documentation. management guidelines to manage, measure, and monitor these market risks. Counterparties are selected based on their rating and in accordance with the Group’s risk diversification strategy. These activities are organized based on a segregation of duties between risk measurement, hedging (front office), administration (back office) and financial control.

23.2 Summary of derivatives

Derivatives are recorded in the balance sheet for the amounts and in the captions detailed as follows:

(EUR millions) Notes June 30, 2019 Dec. 31, 2018 June 30, 2018

Interest rate risk Assets: non-current 33 23 36 current 14 12 14 Liabilities: non-current (1) (7) (8) current (12) (12) (9)

23.3 34 16 33

Foreign exchange risk Assets: non-current 103 18 46 current 140 108 131 Liabilities: non-current (26) (60) (89) current (201) (154) (70)

23.4 16 (88) 18

Other risks Assets: non-current 560 216 289 current 5 3 - Liabilities: non-current (560) (216) (289) current - - -

5 3 -

Total Assets: non-current 10 696 257 371 current 13 159 123 145 Liabilities: non-current 20 (587) (283) (386) current 22 (213) (166) (79)

55 (69) 51

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23.3 Derivatives used to manage interest rate risk

The aim of the Group’s debt management policy is to adapt the debt maturity profile to the characteristics of the assets held, to contain borrowing costs, and to protect net profit from the impact of significant changes in interest rates. For these purposes, the Group uses interest rate swaps and options. Derivatives used to manage interest rate risk outstanding as of June 30, 2019 break down as follows:

(EUR millions) Nominal amounts by maturity Market value (a) (b)

Less than From 1 to More than Total Fair value Not Total 1 year 5 years 5 years hedges allocated

Interest rate swaps, ﬂoating-rate payer 342 1,996 - 2,338 43 - 43 Interest rate swaps, ﬁxed-rate payer - 343 - 343 - (5) (5) Foreign currency swaps, euro-rate payer 92 446 - 538 1 - 1 Foreign currency swaps, euro-rate receiver 59 132 - 191 (5) - (5)

Total 39 (5) 34

(a) Gain/(Loss). (b) See Note 1.9 to the 2018 consolidated ﬁnancial statements regarding the methodology used for market value measurement.

23.4 Derivatives used to manage foreign exchange risk

A significant portion of Group companies’ sales to customers Future foreign currency-denominated cash flows are broken and to their own retail subsidiaries as well as certain purchases down as part of the budget preparation process and are hedged are denominated in currencies other than their functional currency; progressively over a period not exceeding one year unless a the majority of these foreign currency-denominated cash flows longer period is justified by probable commitments. As such, are intra-Group cash flows. Hedging instruments are used to and according to market trends, identified foreign exchange reduce the risks arising from the fluctuations of currencies against risks are hedged using forward contracts or options. the exporting and importing companies’ functional currencies, The Group may also use appropriate financial instruments to and are allocated to either accounts receivable or accounts hedge the net worth of subsidiaries outside the eurozone, in order payable (fair value hedges) for the fiscal year, or to transactions to limit the impact of foreign currency fluctuations against the anticipated for future periods (cash flow hedges). euro on consolidated equity.

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Derivatives used to manage foreign exchange risk outstanding as of June 30, 2019 break down as follows:

(EUR millions) Nominal amounts by fiscal year of allocation (a) Market value (b) (c)

2019 2020 Thereafter Total Future Fair value Foreign Not Total cash flow hedges currency net allocated hedges investment hedges

Options purchased Put USD 230 - - 230 1 1 - - 2 Put JPY - 4 - 4 - - - - - Put GBP 2 - - 2 - - - - - Other ------

232 4 - 236 1 1 - - 2

Collars Written USD 3,295 4,180 - 7,475 106 (5) - - 101 Written JPY 695 1,053 - 1,748 21 - - - 21 Written GBP 250 227 - 477 16 1 - - 17 Written HKD 362 428 - 790 11 - - - 11 Written CNY - 302 - 302 10 - - - 10

4,602 6,190 - 10,792 164 (4) - - 160

Forward exchange contracts USD (50) (77) - (127) 1 1 - - 2 HKD (3) - - (3) - - - - - JPY 16 - - 16 - - - - - CHF (78) - - (78) 3 1 - - 4 RUB 23 - - 23 - (1) - - (1) CNY ------GBP 51 9 - 60 2 - - - 2 Other 143 - - 143 - - - - -

102 (68) - 34 6 1 - - 7

Foreign exchange swaps USD 2,009 439 (527) 1,921 - (105) 2 - (103) GBP 1,031 - - 1,031 - (4) - - (4) JPY 285 - - 285 - (19) - - (19) CNY (164) 19 11 (134) - (3) - - (3) Other (500) - - (500) - (13) (11) - (24)

2,661 458 (516) 2,603 - (144) (9) - (153)

Total 7,597 6,584 (516) 13,665 171 (146) (9) - 16

(a) Sale/(Purchase). (b) See Note 1.9 to the 2018 consolidated ﬁnancial statements regarding the methodology used for market value measurement. (c) Gain/(Loss).

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24. SEGMENT INFORMATION

The Group’s brands and trade names are organized into six business group for Bvlgari. The Selective Retailing business group business groups. Four business groups – Wines & Spirits, Fashion comprises the Group’s own- label retailing activities. Other activities & Leather Goods, Perfumes & Cosmetics, and Watches & and holding companies comprise brands and businesses that Jewelry – comprise brands dealing with the same category of are not associated with any of the above-mentioned business products that use similar production and distribution processes. groups, particularly the media division, the Dutch luxury yacht Information on Louis Vuitton and Bvlgari is presented according maker Royal Van Lent, hotel operations and holding or real to the brand’s main business, namely the Fashion & Leather Goods estate companies. business group for Louis Vuitton and the Watches & Jewelry

24.1 Information by business group

First half 2019

(EUR millions) Wines & Fashion & Perfumes & Watches & Selective Other and Eliminations Total Spirits Leather Cosmetics Jewelry Retailing holding and not Goods companies allocated (a)

Sales outside the Group 2,471 10,387 2,714 2,066 7,072 372 - 25,082 Intra-Group sales 15 38 522 69 26 8 (678) -

Total revenue 2,486 10,425 3,236 2,135 7,098 380 (678) 25,082

Proﬁt from recurring operations 772 3,248 387 357 714 (179) (4) 5,295 Other operating income and expenses 3 - (8) (8) - (41) - (54) Depreciation, amortization and impairment expense (87) (882) (207) (227) (663) (106) - (2,172) Of which: Right-of-use assets (15) (529) (68) (106) (414) (39) - (1,171) Other (72) (353) (139) (121) (249) (67) - (1,001)

Intangible assets and goodwill (b) 6,895 13,069 1,381 5,684 3,420 2,850 - 33,299 Right-of-use assets 123 5,171 481 1,044 4,900 845 (426) 12,138 Property, plant and equipment 2,913 3,895 694 576 1,820 6,336 (9) 16,225 Inventories 5,666 2,739 931 1,831 2,716 43 (365) 13,561 Other operating assets (c) 1,156 1,635 1,407 761 868 1,310 8,564 15,701

Total assets 16,753 26,509 4,894 9,896 13,724 11,384 7,764 90,924

Equity ------35,390 35,390 Lease liabilities 127 5,081 469 993 5,019 910 (431) 12,168 Other liabilities (d) 1,330 4,233 1,900 1,050 2,593 1,579 30,681 43,366

Total liabilities and equity 1,457 9,314 2,369 2,043 7,612 2,489 65,640 90,924

Operating investments (e) (112) (544) (171) (142) (276) (176) (2) (1,423)

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Fiscal year 2018 (f)

(EUR millions) Wines & Fashion & Perfumes & Watches & Selective Other and Eliminations Total Spirits Leather Cosmetics Jewelry Retailing holding and not Goods companies allocated (a)

Sales outside the Group 5,115 18,389 5,015 4,012 13,599 696 - 46,826 Intra-Group sales 28 66 1,077 111 47 18 (1,347) -

Total revenue 5,143 18,455 6,092 4,123 13,646 714 (1,347) 46,826

Proﬁt from recurring operations 1,629 5,943 676 703 1,382 (270) (60) 10,003 Other operating income and expenses (3) (10) (16) (4) (5) (88) - (126) Depreciation, amortization and impairment expense (162) (764) (275) (239) (463) (169) - (2,072) Of which: Right-of-use assets ------Other (162) (764) (275) (239) (463) (169) - (2,072)

Intangible assets and goodwill (b) 6,157 13,246 1,406 5,791 3,430 951 - 30,981 Right-of-use assets ------Property, plant and equipment 2,871 3,869 677 576 1,817 5,309 (7) 15,112 Inventories 5,471 2,364 842 1,609 2,532 23 (356) 12,485 Other operating assets (c) 1,449 1,596 1,401 721 870 976 8,709 15,722

Total assets 15,948 21,075 4,326 8,697 8,649 7,259 8,346 74,300

Equity ------33,957 33,957 Lease liabilities ------Other liabilities (d) 1,580 4,262 2,115 1,075 3,005 1,249 27,057 40,343

Total liabilities and equity 1,580 4,262 2,115 1,075 3,005 1,249 61,014 74,300

Operating investments (e) (298) (827) (330) (303) (537) (743) - (3,038)

52 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

First half 2018 (f)

(EUR millions) Wines & Fashion & Perfumes & Watches & Selective Other and Eliminations Total Spirits Leather Cosmetics Jewelry Retailing holding and not Goods companies allocated (a)

Sales outside the Group 2,257 8,564 2,372 1,917 6,302 338 - 21,750 Intra-Group sales 14 30 505 61 23 9 (642) -

Total revenue 2,271 8,594 2,877 1,978 6,325 347 (642) 21,750

Proﬁt from recurring operations 726 2,775 364 342 612 (134) (37) 4,648 Other operating income and expenses - - (12) (1) - (57) - (70) Depreciation, amortization and impairment expense (75) (355) (130) (112) (221) (92) - (985) Of which: Right-of-use assets ------Other (75) (355) (130) (112) (221) (92) - (985)

Intangible assets and goodwill (b) 6,551 13,164 1,291 5,737 3,325 984 - 31,052 Right-of-use assets ------Property, plant and equipment 2,748 3,700 615 540 1,692 4,874 (7) 14,162 Inventories 5,320 2,156 793 1,566 2,359 20 (331) 11,883 Other operating assets (c) 1,152 1,300 1,274 694 803 1,113 8,307 14,643

Total assets 15,771 20,320 3,973 8,537 8,179 6,991 7,969 71,740

Equity ------31,482 31,482 Lease liabilities ------Other liabilities (d) 1,331 3,689 1,785 1,033 2,502 1,394 28,524 40,258

Total liabilities and equity 1,331 3,689 1,785 1,033 2,502 1,394 60,006 71,740

Operating investments (e) (108) (325) (135) (145) (205) (286) - (1,204)

(a) Eliminations correspond to sales between business groups; these generally consist of sales to Selective Retailing from other business groups. Selling prices between the different business groups correspond to the prices applied in the normal course of business for sales transactions to wholesalers or distributors outside the Group. (b) Intangible assets and goodwill correspond to the carrying amounts shown in Notes 3 and 4. (c) Assets not allocated include available for sale financial assets, other financial assets, and current and deferred tax assets. (d) Liabilities not allocated include financial debt, current and deferred tax liabilities, and liabilities related to purchase commitments for minority interests’ shares. (e) Increase/(Decrease) in cash and cash equivalents. (f) The financial statements as of December 31 and June 30, 2018 have not been restated to reflect the application of IFRS 16 Leases. See Note 1.2 regarding the impact of the application of IFRS 16.

24.2 Information by geographic region

Revenue by geographic region of delivery breaks down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

France 2,153 4,491 2,057 Europe (excluding France) 4,338 8,731 3,863 United States 5,784 11,207 5,041 Japan 1,810 3,351 1,554 Asia (excluding Japan) 8,190 13,723 6,739 Other countries 2,807 5,323 2,496

Revenue 25,082 46,826 21,750

Interim Financial Report - Six-month period ended June 30, 2019 53 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

Operating investments by geographic region of delivery are as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

France 548 1,054 504 Europe (excluding France) 306 539 224 United States 191 765 228 Japan 55 80 39 Asia (excluding Japan) 230 411 141 Other countries 93 189 68

Operating investments 1,423 3,038 1,204

No geographic breakdown of segment assets is provided since a significant portion of these assets consists of brands and goodwill, which must be analyzed on the basis of the revenue generated by these assets in each region, and not in relation to the region of their legal ownership.

24.3 Quarterly information

Quarterly revenue by business group breaks down as follows:

(EUR millions) Wines & Fashion & Perfumes & Watches & Selective Other and Eliminations Total Spirits Leather Cosmetics Jewelry Retailing holding Goods companies

First quarter 1,349 5,111 1,687 1,046 3,510 187 (352) 12,538 Second quarter 1,137 5,314 1,549 1,089 3,588 193 (326) 12,544

Total for ﬁrst half 2019 2,486 10,425 3,236 2,135 7,098 380 (678) 25,082

(EUR millions) Wines & Fashion & Perfumes & Watches & Selective Other and Eliminations Total Spirits Leather Cosmetics Jewelry Retailing holding Goods companies

First quarter 1,195 4,270 1,500 959 3,104 161 (335) 10,854 Second quarter 1,076 4,324 1,377 1,019 3,221 186 (307) 10,896

Total for ﬁrst half 2018 2,271 8,594 2,877 1,978 6,325 347 (642) 21,750

Third quarter 1,294 4,458 1,533 1,043 3,219 173 (341) 11,379 Fourth quarter 1,578 5,403 1,682 1,102 4,102 194 (364) 13,697

Total for second half 2018 2,872 9,861 3,215 2,145 7,321 367 (705) 25,076

Total for 2018 5,143 18,455 6,092 4,123 13,646 714 (1,347) 46,826

25. OTHER OPERATING INCOME AND EXPENSES

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Net gains/(losses) on disposals 3 (5) 3 Restructuring costs - 1 - Transaction costs relating to the acquisition of consolidated companies (4) (10) - Impairment or amortization of brands, trade names, goodwill and other property (37) (117) (73) Other items, net (16) 5 -

Other operating income and expenses (54) (126) (70)

Impairment and amortization expenses recorded are mostly for brands and goodwill.

54 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

26. NET FINANCIAL INCOME/(EXPENSE)

(EUR millions) June 30, 2019 Dec. 31, 2018 (a) June 30, 2018 (a)

Borrowing costs (77) (158) (73) Income from cash, cash equivalents and current available for sale ﬁnancial assets 29 44 18 Fair value adjustment of borrowings and interest rate hedges (3) (3) (1)

Cost of net ﬁnancial debt (51) (117) (56)

Interest on lease liabilities (145) - -

Dividends received from non-current available for sale ﬁnancial assets 1 18 18 Cost of foreign exchange derivatives (102) (160) (68) Fair value adjustment of available for sale ﬁnancial assets 101 (108) 95 Other items, net (9) (21) (11)

Other ﬁnancial income and expenses (9) (271) 34

Net ﬁnancial income/(expense) (205) (388) (22)

Income from cash, cash equivalents and current available for sale financial assets comprises the following items:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Income from cash and cash equivalents 21 31 13 Income from current available for sale ﬁnancial assets 8 13 5

Income from cash, cash equivalents and current available for sale ﬁnancial assets 29 44 18

The cost of foreign exchange derivatives breaks down as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Cost of commercial foreign exchange derivatives (103) (156) (65) Cost of foreign exchange derivatives related to net investments denominated in foreign currency 3 3 2 Cost and other items related to other foreign exchange derivatives (2) (7) (5)

Cost of foreign exchange derivatives (102) (160) (68)

27. INCOME TAXES

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Current income taxes for the fiscal year (1,556) (2,631) (1,232) Current income taxes relating to previous fiscal years 5 76 6

Current income taxes (1,551) (2,555) (1,226)

Change in deferred income taxes 90 57 (29) Impact of changes in tax rates on deferred income taxes 30 (1) (9)

Deferred income taxes 120 56 (38)

Total tax expense per income statement (1,431) (2,499) (1,264)

Tax on items recognized in equity 15 118 110

Interim Financial Report - Six-month period ended June 30, 2019 55 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

The effective tax rate is as follows:

(EUR millions) June 30, 2019 Dec. 31, 2018 June 30, 2018

Proﬁt before tax 5,036 9,489 4,556 Total income tax expense (1,431) (2,499) (1,264)

Effective tax rate 28.4% 26.3% 27.7%

The effective tax rate used as of June 30 is the forecast effective tax rate for the fiscal year. The Group’s effective tax rate was 28.4%, up 0.7 points from the first half of 2018.

28. EARNINGS PER SHARE

June 30, 2019 Dec. 31, 2018 June 30, 2018

Net proﬁt, Group share (EUR millions) 3,268 6,354 3,004

Average number of shares outstanding during the ﬁscal year 505,182,367 505,986,323 506,624,444 Average number of treasury shares owned during the ﬁscal year (1,571,270) (3,160,862) (3,807,863)

Average number of shares on which the calculation before dilution is based 503,611,097 502,825,461 502,816,581 Basic earnings per share (EUR) 6.49 12.64 5.97

Average number of shares outstanding on which the above calculation is based 503,611,097 502,825,461 502,816,581 Dilutive effect of stock option and bonus share plans 943,627 1,092,679 1,286,090 Other dilutive effects - - -

Average number of shares on which the calculation after dilution is based 504,554,724 503,918,140 504,102,671 Diluted earnings per share (EUR) 6.48 12.61 5.96

29. OFF-BALANCE SHEET COMMITMENTS

The Group’s off-balance sheet commitments, which amounted and 2.0 billion euros following the payment of the acquisition to 18.2 billion euros as of December 31, 2018, decreased by price for Belmond (see Note 2), included within share purchase 13.5 billion euros in the first half of 2019, including 12.6 billion commitments as of December 31, 2018. euros resulting from the application of IFRS 16 Leases (see Note 1.2)

56 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d CONDENSED HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS Selected notes to the consolidated ﬁnancial statements

30. EXCEPTIONAL EVENTS AND LITIGATION

No significant exceptional events or litigation occurred during the six-month period.

31. RELATED-PARTY TRANSACTIONS

No significant related-party transactions occurred during the six-month period.

32. SUBSEQUENT EVENTS

No significant subsequent events occurred between June 30, 2019 and July 24, 2019, the date at which the financial statements were approved for publication by the Board of Directors.

Interim Financial Report - Six-month period ended June 30, 2019 57 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d STATUTORY AUDITORS’ REVIEW REPORT ON THE HALF-YEARLY FINANCIAL INFORMATION

To the Shareholders, In compliance with the assignment entrusted to us by the Shareholder’s Meeting and in accordance with the requirements of Article L.451-1-2 III of the French Monetary and Financial Code (Code monétaire et financier), we hereby report to you on: • the review of the accompanying condensed half-yearly consolidated financial statements of LVMH Moët Hennessy – Louis Vuitton, for the period from January 1 to June 30, 2019; • the verification of the information presented in the half-yearly Management Report. These condensed half-yearly consolidated financial statements are under your Board of Directors’ responsibility. Our role is to express a conclusion on these financial statements based on our review.

1. Conclusion on the ﬁnancial statements

We conducted our review in accordance with professional standards applicable in France. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with the professional standards applicable in France and consequently does not enable us to obtain assurance that the financial statements, taken as a whole, are free from material misstatements, as we would not become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed half-yearly consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34 – standard of the IFRS as adopted by the European Union applicable to interim financial information. Without qualifying our conclusion, we draw your attention to the matter set out in Note 1.2 to the condensed half-yearly consolidated financial statements regarding the effects resulting from the first application of IFRS 16 on lease contracts and IFRIC 23 on uncertainty over income tax treatments, and changes in the presentation of the balance sheet and cash flow statement.

2. Speciﬁc veriﬁcation

We have also verified the information presented in the half-yearly Management Report on the condensed half-yearly consolidated financial statements subject to our review. We have no matters to report as to its fair presentation and consistency with the condensed half-yearly consolidated financial statements.

Paris-La Défense, July 24, 2019 The Statutory Auditors French original signed by MAZARS ERNST & YOUNG Audit Loïc Wallaert Isabelle Sapet Gilles Cohen Patrick Vincent-Genod

This is a translation into English of the statutory auditors' review report on the half-yearly financial information issued in French and is provided solely for the convenience of English-speaking users. This report includes information relating to the specific verification of information given in the Group’s half-yearly management report.

This report should be read in conjunction with, and construed in accordance with, French law and professional standards applicable in France.

58 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d STATEMENT BY THE COMPANY OFFICER RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT

We declare that, to the best of our knowledge, the condensed interim consolidated financial statements have been prepared in accordance with applicable accounting standards and provide a true and fair view of the assets, liabilities, financial position and profit or loss of the parent company and of all consolidated companies, and that the interim management report presented on page 6 gives a true and fair picture of the significant events during the first six months of the fiscal year and their impact on the financial statements, and the main related party transactions, as well as a description of the main risks and uncertainties for the remaining six months of the fiscal year.

Paris, July 24, 2019

Under delegation from the Chairman and Chief Executive Officer

Jean-Jacques GUIONY

Chief Financial Officer, Member of the Executive Committee

Interim Financial Report - Six-month period ended June 30, 2019 59 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d 60 Interim Financial Report - Six-month period ended June 30, 2019 WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d Design and production: Agence Marc Praquin WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d For any information: LVMH, 22 avenue Montaigne - 75008 Paris Tel. +33 1 44 13 22 22 - Fax +33 1 44 13 21 19 www.lvmh.com WorldReginfo - 1700bdfb-297c-4eec-927f-a81746d27a3d