LVMH announces strong First Half Operating income growth: +19%

Wines & Spirits: a strong increase in operating incomeIn the first half of 2002, operating income for Champagne and Wines increased by 44%, reflecting the return of sustained demand for champagne and stocks at the distributor level returning to normal. The Group’s major champagne brands, notably Dom Pérignon, have performed very well, particularly in the United States and the UK. Notwithstanding a difficult economic situation, operating income from Cognac and Spirits rose substantially due to strong growth of Hennessy in the United States. Hennessy successfully launched Fine de Cognac in Europe and has continued to develop X.O. in Japan. In order to create a new growth area, the Group has acquired a stake in Millennium, owner of the prestigious Belvedere and Chopin vodka brands. Fashion & Leather Goods: Louis Vuitton performing well Operating income growth in the Fashion and Leather Goods business group, in spite of significant investments, confirms the great desirability of the Group’s different brands. Louis Vuitton, in particular, performed remarkably well and maintained its exceptional margins. Sales to domestic customers grew 10% during the first six months of the year. During the second half of the year, Louis Vuitton will accelerate its development by opening new stores and launching new products (such as the Tambour watch for which there is already a worldwide waiting list). The opening of the Louis Vuitton building in Tokyo has been an immense success. Following the recent take over of their control, continuing efforts are being made at Fendi and Donna Karan in order to step up their international development.   Perfumes & Cosmetics: preparation for new launches during the second half Sales in the Perfumes and Cosmetics business group increased by 2%. This performance compares with particularly strong growth (+15%) during the first half of 2001 and illustrates the resilience of the Group’s principal brands, most notably Parfums Christian Dior and Kenzo. The successful launches of Eau Torride and Givenchy pour Homme, as well as the performance of the newer American companies, Fresh and BeneFit, also contributed to this progress. First half operating results are not generally significant in this sector as most of the profits are achieved during the second part the year. There will be several new product launches for the Perfumes and Cosmetics business group during the second half of the year, including the new women’s perfume Dior Addict, and the continued roll-out of the Michael Kors, Marc Jacobs and Kenneth Cole perfumes. Watches & Jewelry: continued strategic refocusing Sales of LVMH brands grew 2% in a depressed market. Chaumet and Christian Dior in particular have performed extremely well, achieving double-digit growth. Sales in the Watches and Jewelry business group overall declined 3% due to the ending of manufacturing for brands outside the Group. In the first half, operating income for the business group, which has little significance at this stage of its development, was impacted by the significant level of investments needed to implement its strategic repositioning. A number of new watch collections will be launched in the second half of 2002. Selective Distribution : improved profitability at DFS; continued growth at Sephora In the context of worldwide weakness in tourism, DFS sales declined 20% during the first half of the year. However, DFS’s cost cutting plan, which was instigated at the end of 2001, has had a positive impact. The objective of DFS, who will continue to pursue its rigorous cost saving efforts in the second half, is to break-even at the end of 2002. Sephora’s sales, up 6%, demonstrated remarkable progress in the first half, thanks to the growth of its activities in Europe and an exceptional performance in the United States and despite store closures in Germany and Japan. In the United States, the 25% growth on a comparable store basis demonstrates the strength and success of the concept, which continues to gain market share. Overall, Sephora’s results reflect strong improvement and progress torwards its objective of becoming profitable in 2003.   2002 Outlook In a generally uncertain economic climate, the end of 2002 for LVMH will be highlighted by:

• Very promising new product launches
• Strategic store openings
• A continued focus to increase cash flow
• Decreasing financial expenses
• Favourable currency hedging

Taking all of these elements into account, which should boost operating income growth during the second half, LVMH confirms its objective of a significant rebound in its 2002 operating income. An interim dividend payment of 0.22 Euro will be made on 3rd December 2002.