Business news with words bain+billion+sales. 3 news.

After a bumper year, the luxury-goods industry is heading for uncertain times MORE than any other industry, the luxury-goods business needs people to feel good about spending money. So at a recent conference in Moscow, Bernard Arnault, the head of Moet Hennessy Louis Vuitton (LVMH), the world's biggest luxury-goods group, went to great lengths to dismiss investors' fears about the impact on the industry of America's credit crisis, a possible recession and the weak dollar. Indeed, Mr Arnault said he expects the industry's sales almost to double in the next five years, thanks to strong demand from emerging markets and the creation of new wealth across the globe. After a depressing period at the beginning of the decade when the terrorist attacks in America, the outbreak of SARS and the war in Iraq reduced international travel and people's appetite for frivolous things, the industry has had three excellent years. According to Bain, a consultancy, sales of luxury goods grew by 9% in 2006 to EURO159 billion ($200 billion) and will reach about EURO170 billion this year, which would be double the 1996 figure. Europe remains the biggest market, with about 40% of sales, though the strongest growth is in China, Russia, the Middle East and some Latin American countries. ...

Geoffrey the Giraffe, the Toys "R" Us mascot, has every reason to feel he's suffering from whiplash. In 1998 the chain ceded its status as the nation's top toy seller to Wal-Mart. Then U.S. same-store sales slipped for four consecutive years. And in 2005, KKR, Bain Capital, and real estate investment firm Vornado Realty Trust took the company private in a $6.6 billion LBO.

3COM Corp, the money-losing computer networking equipment maker that agreed to be taken over by Bain Capital LLC, forecast yesterday it will be profitable in about four years, helped by demand in China and India. The company will earn a profit "around" 2011 as sales rise about 60 percent from last year to US$2 billion, said Jay Zager, chief financial officer of the Massachusetts-based company. 3Com plans to target emerging markets such as India, the world's fastest-growing major telecommunications market, and the Middle East, Zager said. The strategy may build on the success of 3Com's former venture in China with Huawei Technologies Inc, Bain's partner in the US$2.2 billion bid to buy the United States company. "The trick is to offer more products," Zager said. "We're going to focus on emerging markets like India and the Middle East, places where there's going to be greater annual growth." 3Com, which competes against leader Cisco in the US$16-billion global market for network switches, will post an operating profit in the year ending in May 2008, Zager said, declining to specify a figure. The average of four analyst estimates compiled by Bloomberg News is for a US$50.7 million profit. The purchase will lead to some job cuts at the research and development, supply-chain and information technology units of the company, which employs 6,000 people, Zager said, without providing a figure. Shenzhen-based Huawei will hold a 16.5 percent stake as part of the acquisition, scheduled to be completed in the first quarter of 2008. Bain said last week Huawei's involvement won't be a threat to US national security and the company has voluntarily submitted the acquisition agreement for a review by the US Committee on Foreign Investment.