- Vivian Hendriksz |
Luxury heritage label Mulberry is considering opening a third factory in the UK, if it manages to reach its growth targets.
Thierry Andretta, Chief Executive Officer at Mulberry revealed to Reuters that the luxury fashion house is “fully committed” to manufacturing in the UK, even though recent currency exchange had made local production more difficult for the company. Mulberry has faced higher import costs since the Brexit vote. "We want to continue this and I hope one day when we grow perhaps we will even consider opening another factory,” he said.
The luxury label currently produces more than 50 percent of its handbags in the UK across its two factories in Somerset, which employ approximately 600 people between them. Mulberry also aims to continue supporting apprenticeships, during which the company teaches new apprentices how to make their leather goods. A new factory could create as many as 300 new roles for leather craftworkers , helping safeguard local skills as well.
Mulberry’s sales have improved since Andretta took over the helm of the label in 2015 and moved away from the company’s former business strategy, which saw the prices of a number of iconic handbags increase to more than 1,000 pounds. Now approximately three-quarters of Mulberry leathers goods retail for under 1,000, ensuring the brand is more accessible to a wider range of consumers.
Andretta’s strategy appears to be paying off, as Mulberry’s retail sales increased 2 percent and its gross margin increased by 1.9 million pounds in the six months to September 30, 2017.
- Prachi Singh |
Marks and Spencer Plc (M&S) today announced that as part of its transformation plan, the company intends to reposition 25 percent of clothing & home space through a combination of closures, downsizes, relocations and conversions to food-only stores. The company said, six stores at Birkenhead, Bournemouth, Durham, Fforestfach, Putney and Redditch, will close by the end of April, and a further eight stores at Andover, Basildon, Bridlington, Denton, Falmouth, Fareham, Keighley and Stockport are proposed for closure. M&S added that 468 employees across the company’s stores will be affected and will now enter a period of consultation.
Commenting on the development, Sacha Berendji, Director of Retail at Marks & Spencer said in a statement: ““We don’t want any colleagues to leave M&S and we will work with each colleague individually on what is best for them as we endeavour to give everyone a role. However, we accept in some cases we may have to consider redundancy. We believe these changes are vital for the future of M&S and we will continue to accelerate the programme, taking tough but necessary decisions, as we focus on making M&S special.”
M&S has also reassessed and reduced its Simply Food opening programme, and now only plans to open 36 owned and franchise stores over the next six months. New locations will include Broadstone, Streatham Hill and St Albans. These stores will sell M&S food and drink and offer collect in store for clothing & home. Two stores will also be relocated and converted from a clothing and food store to a Foodhall.
This update follows M&S’s announcement in November that it is accelerating its UK store estate plan after the better than expected levels of sales transfer from closures and plans to grow online sales. M&S currently has 1,025 stores in the UK: 302 clothing, home and food, 684 food-only and 39 outlets.
- Prachi Singh |
Joules Group revenue increased by 18.2 percent or 17.5 percent in constant currency to 96.2 million pounds (136 million dollars) for the 26 weeks to November 26, 2017, which the company said were driven by growth across retail and wholesale channels. Retail revenue for the period increased by 16.2 percent with ecommerce sales up 19.7 percent and store sales up 14.2 percent.
Commenting on the interim update, Colin Porter, Chief Executive of the company said in a press release: “The Joules brand has continued to perform very well, delivering growth in customer numbers and further expansion across channels, product categories and target markets. Whilst trading conditions look set to remain challenging across the sector, with our differentiated brand, unique product offer, loyal and growing customer base, exceptional team and well-invested infrastructure, Joules is well positioned for continued progress and expansion.”
Wholesale revenue during the period under review, increased by 23 percent or 20.6 percent in constant currency, while international revenue increased by 26.4 percent and now represents 11.3 percent of group revenue.
Underlying EBITDA increased by 22.5 percent year on year to 13.3 million pounds (18.8 million dollars) with EBITDA margin increasing 40 basis points to 13.8 percent and active customer base increased by 18 percent to 1,090,000. The company has announced an interim dividend of 0.7 pence.
Joules added that retail sales over the Christmas period January 7, 2018 were up 19.2 percent year on year and the board now anticipates that full year profit to be slightly ahead of the range of analysts’ expectations.
- Prachi Singh |
According to preliminary figures, Gerry Weber International AG generated consolidated sales revenues of 880.9 million euros (1,096 million dollars) in the fiscal year 2016/17. The company said, at 2.2 percent, the decline in sales revenues on the previous year is within the planned range of a decline of 2 percent to 4 percent. Preliminary group EBIT reported of 10.3 million euros, the company added, are also within the projected range of 10 million euros to 20 million euros (12 to 24.9 million dollars). Adjusted for one-time effects resulting from the Fit4Growth realignment programme, EBIT (adjusted) amounted to 19.9 million euros (24.7 million dollars).
Sales revenues of the Gerry Weber core brands declined by 4.4 percent to 686.6 million euros (855 million dollars) in the reporting period from November 2016 to October 2017. The Gerry Weber core wholesale segment contributed 294 million euros (366 million dollars) compared to 298.4 million euros (371.6 million dollars) last year, to total core revenues, while the Gerry Weber core retail segment contributed 392.6 million (488.7 million dollars) against 419.2 million euros (521.8 million dollars) last year.
Gerry Weber wholesale declines by 1.5 percent, retail by 1.9 percent
Declining by 1.5 percent, Gerry Weber said, sales revenues of the Gerry Weber core wholesale segment showed a better trend than had originally been expected in view of the weak market environment of the German fashion industry. Sales revenues of the Gerry Weber core retail segment were affected by the closure of another 68 stores in FY 2016/17. Corresponding to the decline in sales revenues of the German fashion retail sector by approximately 2 percent, like-for-like revenues of the Gerry Weber core retail segment dropped by 1.9 percent.
HallHuber, the wholly-owned subsidiary, contributed 194.3 million euros (241.8 million dollars) or around 22.1 percent to total revenues of the Gerry Weber Group.
The company added that in spite of the successful implementation of the Fit4Growth realignment programme and the related reduction in personnel and operating expenses, it has been unable to improve the group’s earnings compared to the previous year. The reduced Gerry Weber core retail revenues and investments in the quality and perceived value of the company’s products as well as in the IT infrastructure and logistics, Gerry Weber said, had an adverse impact on the operating result.
- Prachi Singh |
Sales at Hennes & Mauritz AB (H&M) including VAT amounted to 58,481 million Swedish krone (7,431.4 million dollars), down 2 percent in local currencies. Sales including VAT in the financial year 2016/2017 increased by 4 percent or 3 percent in local currencies and amounted to 231,771 million Swedish krona (29,453 million dollars). Sales excluding VAT amounted to 50,407 million Swedish krona (6,405.7 million dollars) in the fourth quarter and to 200,004 million Swedish krona (25,416 million dollars) in the financial year 2016/2017.
"Our performance during 2017 was mixed, with progress in some areas but also difficulties in others. We delivered growth of 3 percent in 2017, which is clearly below our expectations. In the fourth quarter our sales overall decreased by 2 percent in local currencies. Our online sales and our newer brands performed well but the weakness was in H&M’s physical stores where the changes in customer behaviour are being felt most strongly and footfall has reduced with more sales online. In addition, some imbalances in certain aspects of the H&M brand’s assortment and composition also contributed to this weaker result,” said Karl-Johan Peon, H&M CEO in a statement.
Review of H&M’s Q4 and full year results
Gross profit amounted to 27,929 million Swedish krona (3,552 million dollars) against 30,027 million Swedish krona (3,818 million dollars) in the fourth quarter last year, corresponding to a gross margin of 55.4 percent against 57 percent. For the financial year, gross profit increased to 108,090 million Swedish krona (13,737 million dollars), corresponding to a gross margin of 54 percent.
Profit after financial items in the fourth quarter amounted to 4,873 million Swedish krona (619 million dollars) against 7,409 million Swedish krona (942 million dollars). Profit after financial items in the full-year amounted to 20,809 million Swedish krona (2,646 million dollars) against 24,039 million Swedish krona (3,057.5 million dollars) last year. H&M said, profit during the year was negatively affected by a weak sales development in the physical stores of the H&M brand. This, the company added, is mainly due to the ongoing shift in the industry, in which sales are increasingly taking place online but where the group’s online share does not yet compensate for the reduced footfall to stores.
H&M expands global online presence, to launch Afound this year
H&M’s ninth brand Afound will be an off-price marketplace offering a broad and diverse range of discounted products from popular fashion and lifestyle brands for women and men, from external brands as well as the H&M group. With a focus on styling and inspiring presentation, as well as attractive offerings from brands in different price segments, Afound, H&M said, will offer a new engaging shopping experience. Afound’s marketplace will be launched during 2018 online in Sweden and with physical stores starting in Sweden. The first store will open on Drottninggatan in Stockholm.
"The H&M group is developing new brands – we now have eight brands that are all scalable – and we will soon launch our ninth brand, Afound," added Peon.
In 2017 H&M’s online store was opened in further eight new markets: Turkey, Taiwan, Hong Kong, Macau, Singapore, Malaysia, Cyprus and the Philippines and the H&M online store is currently available in 44 markets including Kuwait which opened in December 2017. The company said that online expansion will continue in 2018 to among others India and via franchise partners to Saudi Arabia and the United Arab Emirates.
Five new H&M store markets were opened in 2017: Kazakhstan, Colombia, Iceland, Vietnam and Georgia and new H&M store markets in 2018 will be Uruguay and Ukraine. For the full-year 2018 approximately 390 new stores are planned to open, with a primary focus on growth markets. Approximately 170 store closures are planned as a part of the intensified store optimisation plan. The net addition of new stores will amount to approximately 220 (388). Most of the new stores in 2018, the company added, will be H&M stores, of which 45 will have H&M Home shop-in-shops, while approximately 95 stores will consist of the brands COS, & Other Stories, Monki, Weekday, Arket and Afound. In 2018, seven standalone H&M Home stores are planned to open.
Current quarter sales expected to rise 1 percent
Sales including VAT in the period December 1, 2017 to January 31, 2018 are expected to increase by 1 percent in local currencies compared to the corresponding period the previous year. The company said, in view of the high level of stock-in-trade on the closing date of November 30, 2017 and weak sales at the beginning of the first quarter 2018, it is expected that markdowns in relation to sales will increase by around 1.5 - 2.0 percentage points in the first quarter of 2018 compared with the same quarter last year.
The board of directors has decided to propose an unchanged dividend of 9.75 Swedish krona (1.24 dollars) per share to the annual general meeting on May 8, 2018, corresponding to 99.7 percent of the group’s profit after tax.
- Sara Ehlers |
Iconic brand Abercrombie & Fitch Co. is having a rough start to 2018. The label is currently close to ending a class-action lawsuit at the cost of 25 million dollars over worker issues.
The employers are now required to reimburse employees that are required to purchase a work uniform, according to WWD. Last Friday, approximately 260,000 current and former employees of Abercrombie and Hollister alleged that the retailer forced them to buy branded apparel to wear at work without reimbursement. The employees affected by this class-action lawsuit date back to those working in 2013 until now.
Regarding these allegations, a company spokeswoman told the publication, “Abercrombie strongly contests the allegations, however, it believes it is in the best interest of the company and all its stakeholders, including its employees, to settle this matter.”
The settlement agreement will ultimately result in 25 million dollars towards a worker payment fund. Out of this total, approximately 8.5 million will go towards legal fees and 16.68 million dollars will remain for disbursements. While the company still disregards the validity of these allegations, it seems Abercrombie is willing to pay its dues and move forward.
- Prachi Singh |
In its preliminary results announcement for the year ended December 31, 2017, Safilo Group S.p.A. said that sales were 1,047 million euros (1,303 million dollars) for the year and declined by 194 million euros (241 million dollars) at constant currency compared to 2016. Safilo expects profitability for the year to be impacted by the larger decline in sales than planned in the fourth quarter leading to an adjusted preliminary full year EBITDA of 38-40 million euros (47-49.7 million dollars).
The company said that the reduction in sales was caused both by the change of the Gucci license into a supply agreement, representing 155 million euros (193 million dollars) or negative 12 percent and the implementation of the new order-to-cash IT system in the Padua DC early in the year. Safilo added that Dior collections experienced a decline after several years of strong growth. The total of all other licenses, as well as the company-owned core brands, grew single digits. The net sales of the going forward brand portfolio decreased by 3.9 percent at constant exchange rates.
Q4 net sales declined to 249.2 million euros
In the fourth quarter of 2017, Safilo’s preliminary total net sales were 249.2 million euros (310 million dollars), contracting by 53 million euros (66 million dollars) at constant currency compared to 2016. The net effect of exiting the Gucci license and entering the supply agreement, the company said, accounted for 44 million euros (55 million dollars) of the decrease, while net sales of the going forward brand portfolio declined by 3.7 percent at constant currency and 5.2 percent excl. retail.
On the one hand, Safilo added, the emerging markets continued their post Padova DC turnaround started in the third quarter, up again high double digits. The North of Europe started its turnaround in the fourth quarter, now also up double digit. On the other hand, the South of Europe still suffered from the tail-end of the Padua DC issues with fall/winter collection sell-in restrained by the late deliveries of the spring/summer collection. North America declined driven by the wholesale business, while the performance of the Solstice stores in the United States showed an improvement with 2.7 percent same store sales performance at constant exchange rates.
- Prachi Singh |
SMCP, owner of Sandro, Maje and Claudie Pierlot, reported 16 percent or 17.5 percent sales growth to 912 million euros (1,135 million euros) in FY 2017. In the fourth quarter, sales increased 14.1 percent to 256 million euros (318 million dollars), which the company said was driven by a very dynamic performance over the holiday season and despite tough market conditions in October. Exchange rates had a similar impact in Q4 than in the previous quarter and growth at constant currency reached 16.8 percent. Digital sales were up 46 percent and reached 12 percent of total sales.
Commenting on the company’s performance, Daniel Lalonde, SMCP’s Chief Executive Officer, said in a media statement: “SMCP has once again posted a fantastic year in terms of net sales and strategic network expansion across all regions and brands. We have opened doors in prestigious locations, set foot in new territories, further developed our omnichannel services, launched new ecommerce sites and have kept offering amazing collections throughout the year. We have exceeded our yearly growth objective and we confirm our full-year 2017 guidance on EBITDA margin.”
SMCP continues to expand global retail footprint
Over the last three months, SMCP said that the company continued to pursue its international expansion with 37 net POS including openings such as K11 in Shanghai for both Sandro and Maje, a free-standing store in Milan for Claudie Pierlot, Maje at the Venetian in Macau as well as Sandro and Maje in the upgraded Century City, LA.
In October, the company also unveiled its Sandro and Maje eyewear collections at the Silmo eyewear show. The fourth quarter also saw further development of omni-channel services, including the full roll out of store-to-web for Maje in France.
SMCP markets and brands perform positively in FY17
In FY17, the company added that growth in APAC was outstanding at 40 percent. Greater China drove the point of sales growth with 37 net openings out of the 50 across the region. 2017 saw the opening of five new cities in Mainland China: Wuhan, Xian, Kunming, Harbin and Jinan - bringing the total to 21, where the group is present in Greater China - as well as the launch of Taiwan as a direct market. Sandro and Maje also opened their direct e-commerce sites in China.
In EMEA, the group posted 24 percent sales growth. SMCP continued its footprint expansion with 48 net openings in 2017, mostly in Italy and Germany. In Americas, SMCP sales increased 18 percent in 2017, across all channels with 15 net new openings in 2017. In France, growth was 3 percent in 2017.
The company also reported double digit growth across all brands with Sandro witnessing a 21 percent sales rise. The brand opened 53 new stores in 2017 included the opening of European doors. Maje recorded a 10 percent growth with a continued success of accessories and more specifically the leather goods. Maje’s sustained its footprint expansion with 39 new openings supported by new stores in Greater China. Claudie Pierlot’s sales growth was 16 percent in 2017 driven by the increasing brand awareness in EMEA, where the brand launched two new direct markets this year including Italy and Luxemburg. The brand expanded its footprint with 21 net openings in 2017.
The group has confirmed its 2017 full year guidance on EBITDA margin of 16.5 percent as well as on capex and net leverage. At the end of 2017, SMCP brands are present in more than 1,300 points of sales in 38 countries.
Picture:Claudie Pierlot website
- Angela Gonzalez-Rodriguez |
Julian Dunkerton, co-founder of Superdry’s brand, has obtained almost 18 million pounds after selling one million shares in the fashion company.
According to financial update issued by the apparel group on Monday, Dunkerton has sold one million shares (1.23 percent of the company’s equity) in Superdry, at 17.80 pounds apiece. As noted by the ‘Financial Times’, the price showed a 1 percent discount compared to last Friday’s closing price.
The sale represents a 1.23 per cent stake in the company, and leaves Dunkerton as the majority shareholder.
Superdry’s shares up by 17 percent over last 12 months
The apparel group’s stock has gained 17 percent value over the last 12 months, following a corporate rebranding – the group was formerly known as SuperGroup -, and a diversification and internationalisation plan.
Despite the positive trend, the retailer suffered from a sales slowdown which, although in line with market expectations, costed the company a 14 percent dent in stock’s value. Decline started earlier in January when Superdry reported its Christmas sales update.
Although in line with market expectations, results showed earlier growth has plateaued. Eleonora Dani, analyst at Stifel commented on the company’s financials highlighting that “the shares’ recent rally left little room for the stock to outperform”. On the other hand, Superdry's CEO, Euan Sutherland, said the movement represented profit-taking by investors that had benefited from the recent rise in the share price.
Photo: Superdry website
- AFP |
Swatch has handily outrun the global watch crisis, it said Tuesday, with revived sales in Asia pushing 2017 profits more than 27 percent higher from the previous year.
The world's largest watchmaker saw its net profit swell to 755 million Swiss francs ($812 million, 651 million euros), more than a quarter higher than in 2016. Swatch, which is best known for its brightly coloured plastic-cased watches but which also owns 20 luxury brands including Breguet, Harry Winston and Omega, meanwhile said its operating profit rose 5.4 percent to 8.0 billion Swiss francs last year.
The results were above expectations, with analysts polled by Swiss financial news agency AWP anticipating it would rake in a net profit of 748 million Swiss francs on sales of 7.8 billion. That is good news for Swatch, which was hard hit when weak economic growth plunged Swiss watchmakers into crisis over the two previous years, following several years of sky-rocketing growth. Exports to China especially, which for years generated in double-digit growth, crashed hard following efforts to crack down on corruption there by banning extravagant gifts like expensive watches to public officials.
The company said its sales soared in particular in the Asia-Pacific region last year, although it did not provide a detailed regional breakdown of its results. Swatch said its watches and jewelry sales took off in especially in the second half of last year, shooting up 12.2 percent, largely thanks to more demand for luxury brands like Omega. But Swatch, whose lower-end brands have been facing ballooning competition from Apple and other smart-watch makers, stressed that it had seen "highly accelerated sales growth in all price segments".
The company pointed out that it had seen "impressive growth rates" during the second half of the year for lower and middle range watches like Flik Flak, Swatch and Tissot, despite the fact that the Swiss watch industry as a whole had been "clearly negative" in these segments. "This indicates a massive gain in market share in these segments," it said. Looking forward, the company said it "anticipates further very positive growth in local currencies in 2018." Following the news, Swatch saw its share price shoot up more than four percent in late afternoon trading to 416.80 Swiss francs, as the Swiss stock exchange's main SMI index inched down 0.4 percent.(AFP)