July 31st, 2012

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Coach Earnings Up 24.2% on international sales growth

Tuesday, July 31st, 2012

Strong international sales drove an increase in Coach’s fourth-quarter net income, but the company said the heavy promotional environment hit sales growth in its North American factory stores.

The New York-based brand was still able to post a 24.2 percent rise in fourth-quarter income to $251.43 million, or $0.86 cents a diluted share, a penny better than analysts’ expectations. This compared with year-ago net income of $202.48 million, or $0.68 cents a share.

Sales were $1.16 billion for its fourth fiscal quarter, compared with $1.03 billion in the same period prior year, a 12% growth. Analysts estimated revenues of $1.20 billion for the quarter. But the retailer fell below Wall Street’s sales projections of $1.20 billion.

“During the fourth quarter our international sales remained robust, driven by both distribution and productivity increases,” said chairman and chief executive officer Lew Frankfort. “In North America, however, an increasingly promotional environment led to lower growth than expected in factory stores. As a result, we responded by reinstating our prior practice of in-store couponing in a cross section of factory locations late in the period. It’s important to note that we have significant pricing flexibility and a variety of marketing levers available in this channel, which allow us to balance productivity gains and margin improvement.”

Also, the company announced that during the fourth fiscal quarter, it repurchased and retired about 2.5 million shares at an average cost of $67.79, spending a total of $169 million.

Coach added, “Our goals remain unchanged. We’re committed to achieving double-digit top- and bottom-line growth over our planning horizon.”

German Retail Sales Fall Unexpectedly In June

Tuesday, July 31st, 2012

Germany’s retail sales dropped unexpectedly in June from the prior month, data from the Federal Statistical Office revealed Tuesday.

Retail turnover was down 0.1 percent from May, in contrast to a 0.5 percent rise expected by economists. Nonetheless, the rate of decline was slower than the 0.3 percent drop seen in May.

On a yearly basis, retail sales grew 2.9 percent, offsetting last month’s 1.1 percent fall. Annual increase far exceeded the consensus forecast of 0.4 percent growth.

During January to June, turnover in retail trade in nominal terms increased 2.8 percent and in real terms 0.7 percent.

Hugo Boss posts second quarter profit hike

Tuesday, July 31st, 2012

Premium business Hugo Boss Group is on course to meet its 10% growth target, reporting double digit increases during the second quarter of 2012.

The luxury German company said operating profit before special items rose 16% to EUR226m over the half. Sales increased 16% to EUR1.1bn, rising 12% on a currency neutral basis. Europe posted currency adjusted growth of 12%, while sales in the Americas and Asia Pacific increased by 13% and 7% respectively.

Wholesale revenue rose 4%, while own retail grew 21%, rising 7% on a comparable-store basis.

Over the second-quarter, operating profit before special items increased 20% to EUR485m. Sales increased 14% on a currency neutral basis.

The company said that the improvement was supported by growth in all regions. In Europe, sales increased 17%, while sales grew 11% in the Americas and Asian revenues grew 4% on a currency neutral basis.

Second-quarter wholesale revenue increased 10%, reflecting the introduction of four approximately equal sized collections per year. This shift has meant the summer collection, which is mostly delivered during the second quarter. Own retail stores posted currency adjusted growth of 16%, with comparable store sales rising 4%.

The company is forecasting full-year currency neutral sales growth of 10%. It expects wholesale revenue to remain stable, with a double-digit increase forecast in own retail. It also plans to open some 70 new stores over the course of the year.

“We again achieved significant increases in sales and earnings in the first six months”, said CEO Claus-Dietrich Lahrs.

“This success was driven by increases in all regions. We are therefore confident that we shall achieve our targets for the year as a whole even in a more challenging economic environment.”

Hugo Boss shares were trading lower this morning, downing by around 4.60% midday trade.

Ethel Austin to be bought out of administration

Tuesday, July 31st, 2012

Value retailer Ethel Austin has been saved from administration by Liric, a firm owned by clothing entrepreneur Mike Basso.

Ethel Austin, which plunged into administration for the fourth time since 2008 earlier this month, operated 48 stores mainly in the North and North West of England, the West Midlands and Scotland.

Restructuring specialists GA Europe, recently acquired the debt of Ashloch Ltd, which trades principally as Ethel Austin. Administrators Duff & Phelps have announced the sale of 32 of its stores to Liric. The move safeguards nearly 200 jobs.

The stores will be  handed over in two phases. Some 12 stores were transferred on Saturday (28 July), while the remaining 20 stores will change hands over the next two weeks subject to the satisfaction of certain conditions. Pending the phased handover of the stores to Liric, GA Europe will continue to run the chain and also manage the closure of stores for which a buyer cannot be found.

Commenting on the sale, GA Europe’s Chief Executive Gavin George said: “We are delighted that a buyer has been found for the bulk of the Ethel Austin business, following its restructuring and a short spell under GA Europe’s tenure.”

Duff & Phelps partner Philip Duffy said: “We are extremely pleased to have concluded the sale preserving 198 jobs in the process. Also the sale ensures a future for this well established business.”

The remaining nine stores, as well as the company’s head office and warehouse operations will continue to be traded by the administrators while a buyer is sought.

Earlier this month, the value clothing chain slipped into administration for the fourth time in as many years, putting 500 jobs at risk. The company said the collapse followed a marked downturn in sales caused by the challenging economic climate in the UK.

Aria Partners criticises Christopher & Banks over CEO change

Tuesday, July 31st, 2012

Aria Partners has criticised Christopher & Banks for looking for a new CEO despite the US women’s wear retailer posting improved financial results last week.

Joel Waller was appointed as interim CEO of Christopher & Banks in December on a one-year term contract.

In a statement issued to just-style yesterday (30 July), Aria Partners said: “It is ironic that Christopher & Banks would tout these results while simultaneously interviewing candidates to replace Joel Waller, the current CEO.”

“As we have said many times, we think Joel is a talented executive who will do a good job managing this business. So good, that we’d like to own the entire company.”

“The chairman and lead director will do anything to avoid success, and will stop at nothing to keep their exorbitant fees intact while overseeing massive losses for the company,” Aria Partners added.

Christopher & Banks, which is in the midst of a turnaround plan, said it expects comparable store sales to rise 5-5.5% for the quarter ended 28 July.

Earlier this month, Aria Partners, which owns 4% of Christopher & Banks, continued to urge the retailer to consider its $1.75 per share takeover bid last week, even though it rejected an earlier offer.

Source: Just Style

London’s Milliners Dress Its Landmarks

Tuesday, July 31st, 2012

For the next four days, some of London’s best-known statues will be sporting a new look. The likes of Lord Nelson, King George IV, Shakespeare and Queen Victoria have been given new hats thanks to ‘Hatwalk’, the latest creative project in London to celebrate the Olympic Games.

Unveiled in London’s Trafalgar Square yesterday, Hatwalk is part of the London 2012 Festival, a series of cultural events that runs alongside the Olympics. The project – the brainchild of Boris Johnson – was curated by Stephen Jones and fellow milliner extraordinaire Philip Treacy and sees 21 established and emerging millinery talents recreate headwear for some of the capital’s most famous hat-wearing statues.

“The rest of the world see hats as an innately British thing so this is a great celebration of that, our eccentricity and our talent for millinery,” Jones said.

Beginning in Trafalgar Square, the situation of some of the city’s best-know statues, Nelson’s iconic bicorn hat has been updated by Sylvia Fletcher and Lock & Co (the very same milliners that created the original) to include a Union Jack and Olympic flame. In the square, the statue of King George IV on horseback is wearing a Mughal-inspired, pearl-encrusted gold crown designed by Stephen Jones and inspired by the Brighton Pavillion, the late King’s seaside retreat, and Sir Henry Havelock dons a iridescent satellite creation by Philip Treacy.

The project was born about a year ago, thanks to the Mayor of London, and has involved the employment innovative techniques to ensure that the pieces don’t damage the statues, but also so that they will withstand the British weather.

Jones, who co-curated the project, said the hats were all subjected to rigorous tests to ensure that they can survive London’s elements. “They were put in a wind tunnel and tested to see if they were fire-proof, in case they were struck by lightning,” said Jones, who explained that the initiative aimed to capture a sense of “Britishness.” “What I love [about the project] is, as the opening of the Olympics captured that feeling of classicism and craziness and eccentricity, which is such a British thing, that’s what hats do in general but these do in particular.”

Munira Mirza, Deputy Mayor for Culture and Education said: ”The idea is to make tourists and London to look again at the history of the city and these incredible historical figures, the kind of people that made Danny Boyle’s narrative of history come to life in the Opening Ceremony.”

Other designers involved include Charlie Le Mindu, Piers Atkinson, Pip Hackett, Gina Foster and J Smith Esquire, who have created pieces for the likes of Isambard Kingdom Brunel on Victoria Embankment and Queen Victoria on Blackfriars Bridge.

The hats are on display through to Thursday, and then they will be auctioned to raise money for the London Mayor’s Fund. Life-sized copies of the pieces are on display in BT House at BT London Live in Hyde Park until August 12.

Harrods profits up by 15% despite tough economy

Tuesday, July 31st, 2012

Department store Harrods achieved a 15% rise in profit last year as it defied the economic gloom.

The retailer recorded an 11% sales increase to £651.7m ($1.02bn) in the year to January 28, when pre-tax profit rose 15% to £125.3m ($196bn).

The strong performance came in a year in which the retailer spent £107.8m ($169m) refurbishing the store and opening a new distribution centre in Reading.

Harrods owner Qatar Holding, which bought the retailer from Mohamed Al Fayed for £1.5bn in 2010, last week revealed plans to open a chain of Harrods-branded hotels starting in London, Malysia and Italy.

Last week Harrods opened its Christmas World department at the earliest ever point in the year as it sought to capitalise on the influx of international shoppers as the Olympics got under way.