- Prachi Singh |
Total sales at John Lewis for the week ending February 18, were down 0.7 percent on the same week last year, however, fashion sales were up 3.3 percent with womenswear sales up 16.6 percent on last year. The company said, sales were also boosted by customers purchasing Valentine's Day gifts like jewellery, perfume and purses.
The Charlotte Tilbury counter, John Lewis added, which opened in its flagship, Oxford Street shop last week also witnessed good sales. This week, a range of dresses, designed by award-winning designer Eudon Choi for the company’s Modern Rarity label, are launched in shops and online.
Electrical and home technology sales were down 1.5 percent, while home sales were down 3.7 percent. However, the company further said that Valentine's Day helped increase sales in gifts, cook and dine where sales were up 3 percent, with gift food up 11.5 percent.
Picture:John Lewis website
- Prachi Singh |
Ayrshire-based Balmoral Knitwear (Scotland) Limited has pulled the curtains on its manufacturing business citing increased competition from low cost garments sourced overseas, rising raw material costs and the recent devaluation of the pound as main reasons behind its decision. According to a statement released by provisional liquidators RSM, despite concerted efforts to find a buyer or investor to rescue the business, the management were left with no alternative than to place the company into provisional liquidation.
Commenting on development, Paul Dounis, joint provisional liquidator, said in a statement: “It is with profound regret that employees of this historic business have been made redundant with immediate effect; and we are working with local and national organisations including East Ayrshire Council, PACE (Partnership Action for Continuing Employment), the Job Centre and the Redundancy Payments Service to support those employees who have been made redundant to process claims as quickly as possible.”
“The Balmoral name is well known in the sector and we would ask any parties with an interest in acquiring the business to get in touch with us as soon as possible,” Dounis added.
Founded in 1895, Balmoral Knitwear has been a supplier of both plain and embroidered corporate uniform, school wear and work wear.
- Angela Gonzalez-Rodriguez |
ANALISYSFrench luxury fashion house Chanel has bought a minority stake in Farfetch, inking a strategic partnership with the British upscale fashion e-commerce platform. According to company sources, Chanel aims to leverage Farfetch to “enrich relationship with customer”.
Farfetch founder and CEO José Neves further clarified the partnership, noting it was in line with his brand’s core mission to revolutionise not just e-commerce, but also the physical store experience with what it calls augmented retail.
“We are not starting to sell Chanel on the Farfetch marketplace — I want to be very clear on that,” explained Chanel’s president of fashion. “Our position on e-commerce is the same. We want to connect our customers with our product and our boutiques are the best way to do so. We are very consistent in our strategy, but we are using Farfetch’s know-how to accelerate this.”
Chanel and Farfetch ink a technological partnership
Farfetch’s Neves added that “The mission of Farfetch is to reinvent the luxury shopping experience online as well as offline.” “Style cannot be digitised like music. The physical experience is going to continue to be where the majority of the action takes place.”
Despite the interest arisen, the deal won’t bear fruits any time soon, warned from both companies: “When you are in a long-term partnership, it won’t take place one day to another.” “We are talking about a transformation. Imagine a customer can book an appointment through WeChat or Whatsapp and say they would like to come at two o’clock to see in the fitting room this silhouette or this bag or this shoe. If we want to enrich the customer experience, we have to think about a range of services like that. We need to have a relevant dialogue between the boutique and the customer.”
Chanel buys minority stake in upscale online retailer Farfetch
The goal is not to bring Chanel’s clothing to Farfetch, but to help the French company develop new applications and digital aids, explained Chanel’s fashion president Bruno Pavlovsky in an interview with Reuters.
One such application is to get the customer to fill out several preferences, like clothing size, in an app prior to their store visit, further detailed Pavlovsky, who summed up the goal of this deal stating that “This is about how to enrich our relationship with our customers.” Furthermore, this new digitisation of the shopping experience will help store employees to better and faster assist customers.
Image:Chanel Bags, Spring - Summer 2018, Pre-Collection. Chanel Official
- Angela Gonzalez-Rodriguez |
ANALISYSThe market for used luxury handbags has grown from 5 million pounds seven years ago to more than 26 million pounds last year and is expected to keep on growing.
In fact, according to a recent report by Jefferies, some handbags outperform even the most successful hedge fund. Actually, highlights Jefferies, some owners could be sitting on annual returns of more than 30 percent.
"Christie's data shows that Hermès bags often offer a positive return, for example one Himalaya bought in 2010 for 29,600 euros was sold in 2016 for 157,500 euro marking”, explained the investment bank in a new report.
Second hand luxury handbags’ market grows five-fold in seven years
Jefferies’ analysts met last week with Rachel Koffsky, specialist for luxury handbags at auction house Christie's, who told them the secondary market in those accessories had grown to 26 million pounds in 2017 from 5 million in 2011.
That's a 432 percent upswing against about 310 percent if one had bought a Hermès share at the beginning of 2010 and sold it at the end of 2016, highlighted from the investment bank.
Jefferies cautions however that "most of the top designer handbags such as Chanel, Louis Vuitton and Gucci will (on average) depreciate in value".
According to a recent report by Markets Research Future, globally, the market for luxury fashion has been increasing due to changing consumption patterns and growing demand for new designs and brands.
Growing brand awareness and discounts on big brands online considerably supported the luxury fashion market. Based on those trends, the global luxury fashion market is expected to grow at CAGR over 5 percent from 2016 to 2022.
Secondary data within the same research reveals that among the various market segments accessories specifically watches and jewelry witnessed highest growth followed by clothing in the last few years.
Clothing and accessories dominates the luxury fashion market both in market volume.
Rise in women working population across the world has boosted the luxury fashion product sales to a greater extent, traction for branded items, rise in disposable incomes continue to support growth of the luxury fashion market.
Image: Hermès Birkin, Hermès Official Web
- Prachi Singh |
Sir Philip Green may be considering sale of all or part of his Arcadia Group, reports The Sunday Times. The report added that the Topshop-owner is believed to be negotiating with Chinese textile major Shandong Ruyi. However, according to The Daily Telegraph, Frank Field, the chairman of the influential work and pensions select committee, is urging the government to enable the pensions regulator to bring a stay on the sale to avoid repeat of the BHS-like scandal.
Meanwhile, Shandong Ruyi is strengthening its business interest in Europe with recent acquisition of majority shares in Swiss shoe-maker Bally. The company already owns controlling stake in the French luxury brands Sandro and Maje, the maker of Lycra and the British tailoring houses Aquascutum, Gieves & Hawkes and Kent & Curwen.
Arcadia brands Topshop, Miss Selfridge and Burton have been witnessing considerable decline in revenues in the recent times. The reports further states that the leaked set of Arcadia’s Christmas performance showed almost 10.9 percent fall in Topshop’s like-for-like sales and 6.5 percent drop in Arcadia’s like-for-like sales.
After Green sold BHS to bankrupt Dominic Chappell in 2015 leading to the collapse of the department store a year later with 571 million pounds (800 million dollars) hole in its pension funds, under pressure from the Pensions Regulator and MPs, who voted to confiscate his knighthood, Green had to shell out 363 million pounds (508.6 million dollars) to settle the matter.
Citing documents published by MPs last year, the report states that Arcadia’s pension deficit is at 565 million pounds (791.8 million dollars) on an ongoing basis, or around 1 billon pounds (1.4 billion dollars) on a buyout basis. Last year Arcadia said it would double pension fund contributions to 50 million pounds (70 million dollars) per year, which it expects to close the deficit in eight to nine years.
In 2012, US investor Leonard Green bought a 25 percent stake in Topshop in a 350 million pounds (490.5 million dollars) deal, which included terms that stopped selling or floating the company for five years by the parties involved. The term came to an end in December last year.
- Prachi Singh |
Casino Group through its subsidiary Monoprix has entered into exclusive negotiations to acquire online shoe retailer Sarenza. The company said in a statement, this acquisition aims at completing the offering of Monoprix, and at positioning it as an omnichannel lifestyle leader in fashion, home and beauty segments.
Commenting on the development, Jean-Charles Naouri, Chairman and CEO of Casino Group said in a media statement: “By acquiring Sarenza and its expertise, Casino Group will consolidate its position as French leader in urban online retail. This transaction places Monoprix at the edge of the fashion and home online retail.”
Sarenza with presence in 30 countries in Europe offers over 650 brands and 40,000 designs online and generated more than 250 million euros (310 million dollars) in sales before returns during the last fiscal year.
“We are very pleased with this integration project, allowing us to join a major distribution group and to expand our product offering by leveraging the expertise of Monoprix, one of the most cutting-edge, innovative and popular brand among French people,” added Stéphane Trepoz, Chairman and CEO of Sarenza.
Casino Group is a key player in the French retail industry with more than 12,000 stores worldwide – in France, Latin America and in the Indian Ocean region.
- Angela Gonzalez-Rodriguez |
ANALISIS The multi-label conglomerate has kicked-off an overhaul plan aimed at cleaning up its portfolio and drive growth from their best-performing business units. As a result, VF Corp. has announced it’s looking for a buyer for Nautica.
“While we do not yet have a definitive agreement, we are actively engaged with several parties, and we’ll update you as conditions warrant,” VF chairman and CEO Steve Rendle told investors during a conference call last Friday. “I’d like to thank the Nautica employees for their hard work and dedication as we proceed through this process, and I’m eager for the Nautica organization to move into its next phase of growth and success,” added Rendle.
Nautica’s sale follows divestment from its Licensed Sports Group business in 2017, including the Majestic brand. In August 2016, the company dropped its Contemporary Brands businesses, which included the 7 for All Mankind, Splendid and Ella Moss brands.
The parent company of Timberland, Vans, and The North Face has held ownership of Nautica brand since 2003, when it bought it for 585.6 million dollars.
VF to focus on driving revenue from best-performing brands
VF is in active talks with several potential buyers to sell Nautica, though a final agreement hasn’t been reached, Chief Executive Officer Steve Rendle said on Friday, reports Bloomberg.
The company revamped Nautica’s leadership team last year, but sales have continued to suffer. The brand produced a net loss in 2017 of 95.2 million dollars, forcing VF to report 130.2 million dollars in write-downs to account for Nautica’s lost value.
“Nautica’s not gone -- it’s up for sale,” Rendle said in an interview earlier this month. “Maybe a better owner can help it achieve its full potential.”
Weaker-than-expected Q4 results trigger VF’s divestment from Nautica
VF Corp. shares closed into the red Friday, losing more than 8 percent after the apparel group missed market expectations for fourth-quarter earnings.
VF posted Q4 revenues of 3.6 billion dollars, including a 247 million dollars contribution from the Williamson-Dickie acquisition in October 2017. While it was a 20 percent gain over the comparable period, VF’s revenues missed forecasts calling for sales of 3.7 billion dollars, as disclosed by the company.
Overall, VF’s 2017 revenues increased 7 percent to 11.8 billion dollars, with earnings per share on a reported basis declining 30 percent to 1.79 dollars. In fact, VF was one of the companies that suffered a negative impact from trump new corporate tax (a 1.15 dollars per share negative impact in this case). Adjusted earnings per share increased 4 percent to 2.98 dollars, including a 4-cent contribution from the Williamson-Dickie acquisition.
However, the company’s CEO remains positive, commenting on the results: “VF’s fourth-quarter results were stronger than we expected as growth continues to accelerate across core dimensions of our portfolio.” “We delivered a top-quartile total return for shareholders in 2017, and our strong performance provided us with the capacity to reinvest about 100 million dollars back into our business,” further added Rendle.
On a brand-by-brand case, Rendle told investors that 2017 was “a remarkable year for our largest and fastest-growing brand.” “Revenue for the fourth quarter increased 35 percent, with strength across all regions, channels and product franchises,” he added, noting that the largest growth came in the Americas, where sales gained 38 percent.
Global revenues at The North Face and Timberland were up 6 percent and 8 percent, respectively.
Image:Nautica, Summer 2018, Official Web
- Prachi Singh |
VF Corporation’s revenue increased 20 percent or 18 percent currency neutral to 3.6 billion dollars, including a 247 million dollars contribution from the Williamson-Dickie acquisition, which closed on October 2, 2017. Excluding the Williamson-Dickie acquisition, the company said, revenue increased 12 percent or 10 percent currency neutral, driven by broad-based strength across VF’s international and direct-to-consumer platforms, outdoor & action sports coalition and workwear businesses.
“VF's fourth quarter results were stronger than we expected as growth continues to accelerate across core dimensions of our portfolio,” said Steve Rendle, the company’s Chairman and CEO in a media statement, adding, “We delivered a top-quartile total return for shareholders in 2017 and our strong performance provided us with the capacity to reinvest about 100 million dollars back into our business.”
Review of VF’s Q4 results
During the fourth quarter, the company decided to sell its Nautica brand business and on April 28, 2017, the company completed the sale of its licensed sports group (LSG) business, including the Majestic brand. On August 26, 2016, the company concluded the sale of its contemporary brands businesses, which included the 7 For All Mankind, Splendid and Ella Moss brands. VF’s after-tax net loss from discontinued operations was 17 million dollars in the fourth quarter, while the after-tax net loss from discontinued operations was 106 million dollars for the full year 2017.
Gross margin for the quarter improved 130 basis points to 51.5 percent and on an adjusted basis, gross margin increased 60 basis points to 51.6 percent. Excluding the Williamson-Dickie acquisition, adjusted gross margin increased 140 basis points to 52.4 percent. Changes in foreign currency negatively impacted gross margin by 10 basis points. Operating income on a reported basis was 481 million dollars and on an adjusted basis, increased 6 percent to 497 million dollars, including a 19 million dollars contribution from the Williamson-Dickie acquisition.
Operating margin on a reported basis increased 390 basis points to 13.2 percent, while adjusted operating margin declined 180 basis points to 13.6 percent. Adjusted operating margin, excluding the Williamson-Dickie acquisition, declined 130 basis points to 14.1 percent and changes in foreign currency negatively impacted operating margin by 30 basis points.
Fourth quarter loss per share was 0.18 dollar on a reported basis, including a 1.16 dollars negative impact from recent US tax legislation. On an adjusted basis, earnings per share increased 13 percent to 1.01 dollars, including a 0.04 dollar contribution from the Williamson-Dickie acquisition. Relative to the company's outlook provided on October 23, 2017, fourth quarter earnings per share included an incremental 0.06 dollar or 35 million dollars pretax impact from additional investments to drive accelerated growth in 2018 and beyond.
FY17 revenues rise 7 percent
Full year revenue increased 7 percent to 11.8 billion dollars, including a 247 million dollars contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, revenue increased 5 percent or 4 percent currency neutral, driven by continued momentum in VF's international and direct-to-consumer platforms, outdoor & action sports coalition and workwear businesses.
Gross margin for the year increased 120 basis points to an annual record high of 50.5 percent and on an adjusted basis, gross margin increased 100 basis points to 50.5 percent. Excluding the Williamson-Dickie acquisition, adjusted gross margin increased 120 basis points to 50.7 percent. Changes in foreign currency negatively affected gross margin by 60 basis points. Operating income on a reported basis increased 10 percent to 1.5 billion dollars and adjusted operating income decreased 2 percent to 1.5 billion dollars, including a 19 million dollars contribution from the Williamson-Dickie acquisition.
Operating margin on a reported basis increased 30 basis points to 12.7 percent, while adjusted operating margin declined 120 basis points to 12.9 percent. Excluding the Williamson-Dickie acquisition, adjusted operating margin declined 110 basis points to 13.0 percent. Changes in foreign currency negatively impacted operating margin by 50 basis points.
Earnings per share on a reported basis declined 30 percent to 1.79 dollars, including a 1.15 dollars negative impact from recent US tax legislation. Adjusted earnings per share increased 4 percent or 7 percent currency neutral to 2.98 dollars, including a 0.04 dollar contribution from the Williamson-Dickie acquisition. Relative to the company's original outlook provided on February 17, 2017, full year 2017 earnings per share included a 0.19 dollars or around 100 million dollars pretax impact from incremental investments.
VF expects transition quarter revenue to rise 16 percent
VF added that since there is a change in the company's fiscal year end to the Saturday closest to March 31 from the Saturday closest to December 31 and the company will report results for the transition quarter ending March 31, 2018. For the transition quarter revenue is expected to be around 2.9 billion dollars, up 16 percent, including about a 200 million dollars contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, revenue is expected to increase at a high single-digit rate due in part to changes in foreign currency.
Adjusted earnings per share is expected to approximate 0.65 dollar, up 27 percent, including about a 0.02 dollar contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, adjusted earnings per share is expected to increase more than 20 percent due in part to changes in foreign currency.
Picture:Facebook/The North Face
- Prachi Singh |
VF Corporation has been recognized as one of the 2018 world’s most ethical companies by the Ethisphere Institute. The company said in a statement that VF is the only apparel company to make to the list, underscoring the company’s commitment to leading its industry through ethical business standards and practices.
“We are honoured to be once again recognized as one of the world’s most ethical companies,” said Steve Rendle, VF’s Chairman, President and CEO in a media release, adding, “At VF, we believe that business success and social responsibility are interconnected.”
The world's most ethical companies assessment is based upon the Ethisphere Institute’s Ethics Quotient (EQ) framework, which offers a quantitative way to assess a company’s performance in an objective, consistent and standardized manner. The information collected provides a comprehensive sampling of definitive criteria of core competencies in the areas of corporate governance, risk, sustainability, compliance and ethics.
“While the discourse around the world changed profoundly in 2017, a stronger voice emerged. Global corporations operating with a common rule of law are now society’s strongest force to improve the human condition. This year we saw companies increasingly finding their voice,” added Ethisphere’s CEO, Timothy Erblich.
Picture:VF Corporation website
- Prachi Singh |
The board of directors of Dick’s Sporting Goods, Inc. has authorized and declared a quarterly dividend of 0.225 dollar per share on the company's Common Stock and Class B Common Stock, payable in cash on March 30, 2018, to stockholders of record at the close of business on March 9, 2018. This dividend represents an increase of approximately 32 percent over the company's previous quarterly per share amount and is equivalent to an annualized rate of 0.90 dollar per share.
"The significant increase in our dividend demonstrates the strength of our balance sheet and the confidence we have in our company's future," said Edward W. Stack, Chairman and CEO in a statement, adding, "We remain firmly committed to investing in the profitable growth of our business and returning capital to our shareholders."
Picture:Facebook/Dick's Sporting Goods