Topline<\/p>\n
Billionaire LVMH CEO Bernard Arnault on Thursday warned the Iran war could result in a \u201cworld catastrophe\u201d if left unresolved, a rare comment from one of the world\u2019s richest people on the conflict, as luxury brands have reported a slowdown in demand in recent weeks. <\/p>\n
Luxury brands cited a slowdown in demand throughout the conflict, disrupting earnings. <\/p>\n
Getty ImagesKey Facts<\/p>\n
Arnault, who spoke Thursday during LVMH\u2019s annual shareholder meeting in Paris, said the world is \u201cnow in a pretty serious crisis in the Middle East\u201d and warned the Iran war could spiral into a \u201cworld catastrophe with very serious and very negative economic impact,\u201d according to a translation by LVMH.<\/p>\n
Should the conflict persist, Arnault said it would be impossible to predict the outcome, but noted a resolution would allow businesses to recover and \u201cresume their normal course.\u201d<\/p>\n
LVMH last week reported the Middle East conflict had a 1% negative impact on organic growth through its latest quarter, citing a slowdown in tourist spending throughout Europe, and chief financial officer C\u00e9cile Cabanis said during an earnings call there has been an up to 70% decline in demand since the war began in late February.<\/p>\n
Shares of LVMH, which trade at the Euronext Paris stock exchange, dropped slightly (0.2%) as of Thursday morning.<\/p>\n
Big Number<\/p>\n
Nearly 15%. That\u2019s how much LVMH\u2019s shares declined by in March, adding to a 26% plunge on the year so far while reducing the luxury conglomerate\u2019s market valuation to $228.8 billion from $268.9 billion.<\/p>\n
Forbes Valuation<\/p>\n
Arnault, who was once the richest person in the world, is now the ninth-richest, with an estimated net worth of $149.2 billion<\/a> as of Thursday.<\/p>\n The Iran War\u2019s Toll On Luxury Brands<\/p>\n Luxury bellwethers Kering\u2014whose core brands include Gucci, Balenciaga and Saint Laurent, among others\u2014and Herm\u00e8s reported first-quarter earnings last week that disappointed investors as they cited waning tourist demand during the Iran war. Herm\u00e8s reported its wholesale activity was \u201csignificantly\u201d disrupted by lower sales to concession stores, especially in the Middle East and in airports. UBS analyst Zuzanna Pusz wrote last month that \u201celevated global uncertainty has generated significant investor anxiety,\u201d particularly among those waiting for a \u201clong-awaited recovery in luxury demand this year.\u201d<\/p>\n Key Background<\/p>\n Arnault\u2019s comment on the Iran war is a rare insight into how the billionaire class views the conflict. Billionaire and former Qatari Prime Minister Hamad bin Jassim bin Jaber Al Thani warned last month that Iran\u2019s attacks on Qatar\u2019s energy infrastructure would only push the Middle East \u201ctoward the abyss of a mad war.\u201d A two-week ceasefire, which was set to expire Wednesday, is likely to be extended after President Donald Trump said Tuesday he expected Iran to make a deal even as negotiations were called off.<\/p>\n Further ReadingForbesTrump Says Iran Ceasefire Extended Despite Calling Off NegotiationsBy Sara Dorn<\/a>ForbesIran Seizes 2 Ships In Strait Of Hormuz\u2014Third Ship Attacked, State Media ClaimsBy Siladitya Ray<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Topline Billionaire LVMH CEO Bernard Arnault on Thursday warned the Iran war could result in a \u201cworld catastrophe\u201d…\n","protected":false},"author":2,"featured_media":547814,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[58775,188606,84,59,62013,585,58740,188607,56,54,55],"class_list":{"0":"post-547813","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-bernard-arnault","9":"tag-bernard-arnault-net-worth","10":"tag-business","11":"tag-gb","12":"tag-hermes","13":"tag-iran","14":"tag-lvmh","15":"tag-lvmh-shares","16":"tag-uk","17":"tag-united-kingdom","18":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/547813","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=547813"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/547813\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/547814"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=547813"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=547813"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=547813"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}