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Looking Great Gown ALL ABOUT OSCAR The stars were out and celebrating during Academy Awards weekend, from the Hollywood Hills pre-parties to the red carpet at the Kodak Theatre, pages 16 to 19. Women’s Wear Daily • The Retailers’ Daily Newspaper • February 23, 2009 • $3.00 collections/fall ’09 NEW YORK WAccessories/Innerwear/LegwearwDMONdAY Looking Great Ralph Lauren showed a dazzling fall collection, full of beautiful clothes with no shortage of embellishment. There were terrific haberdashery tailored tweeds for day and luxe, sophisticated looks for evening. Here, one example: a beaded, illusion-detailed gown. For more on the season, see pages 6 to 15. Feeling Luxe’s Squeeze: Factors Drop Barneys Over Sale Uncertainty By David Moin and Vicki M. Young The financial vise is tightening on Barneys New York, with some factors no longer approving spring orders as a result of uncertainties over the luxury chain’s future. Barneys’ costly expansion of the past three years has failed to gain traction; the retailer has been without a chief executive officer since last July, and the severe downturn in retailing, particularly the luxury sector, has hit the retailer and its cash flow hard. Its owner, Dubai-based Istithmar, has been quietly trying to sell the chain at a price no one wants to pay as the Middle Eastern emirate faces its own economic meltdown. All those factors are making certain vendors and suppliers skittish over Barneys and less inclined to take risk, though the luxury chain See Financial, Page4 PHOTO BY ROBERT MITRA ROBERT PHOTO BY 2 WWD, MONDAY, FEBRUARY 23, 2009 WWD.COM Penney’s Forecasts Loss, Sales Drop By Vicki M. Young near-term pressures. While taking advantage of opportunities, we’ll strengthen our longer-term J.C. PENNEY CO. INC. ON FRIDAY POSTED A competitive position.” WWDAccessories/Innerwear/LegwearMONDAY 51 percent slide in fourth-quarter profits, hurt Ken C. Hicks, president and chief merchan- by the curtailment of consumer spending, but dising officer, said during the call, “J.C. Penney the retailer still managed to beat Wall Street’s continues to lead in women’s apparel, where our FASHION expectations by 3 cents. sales trends were once again stronger than our Ralph Lauren shone, Ralph Rucci went above and The company also told Wall Street it expects competitors. For the fourth quarter, women’s ap- 6 beyond and L’Wren Scott executed a winning to post a first-quarter loss in the range of 20 to 30 parel and family shoes were our best-performing collection as New York Fashion Week wrapped up. cents a share. businesses….The fine jewelry division continues For the three months ended Jan. 31, income to be our weakest business, consistent with others GENERAL was $211 million, or 95 cents a diluted share, in the industry. For the quarter, jcp.com sales de- The financial vise is tightening on Barneys, with down from $430 million, or $1.93, in the same creased approximately 8.6 percent versus a 13.7 1 some factors no longer approving spring orders year-ago quarter. The Wall Street consensus percent increase last year.” because of uncertainties over the chain’s future. among analysts was 92 cents. Sales fell 9.9 percent Hicks said the company last year opened 35 to $5.76 billion from $6.39 billion. Comparable- new or relocated stores. It also completed signifi- 3 Coach Inc. is launching a jovial collection called store sales in the quarter dropped 10.8 percent. cant fixturing and store environment improve- Poppy with a broader price range intended to For the year, income declined 48.5 percent to ments in about 600 stores across the country, as reach a customer with a more youthful attitude. $572 million, or $2.57 a diluted share, from $1.11 well as 24 major renovations and 90 store refur- Most retailers concluded New York Fashion Week billion, or $4.93, in 2007. Sales were down 6.9 bishments. The retailer opened 44 Sephora stores 12s in a reflective, positive mood, despite repeated percent to $18.49 billion from $19.86 billion. inside Penney’s locations in 2008, bringing its total “Effectively executing our Bridge Plan enabled Sephora in-store shops to 91 locations. The current days of depressing economic news. J.C. Penney to maintain a strong financial position plan is to “accelerate our Sephora openings in 2009 20 INNERWEAR: The fall market reflected the angst and improve our cash flow metrics, despite the with 64 additional locations planned,” he said. and uncertainty of a battered economy and sharp deterioration of consumer spending over Hicks also emphasized, “The benefit of our cutbacks at stores from Macy’s to Wal-Mart. the course of 2008,” said Myron E. “Mike” Ullman proactive approach on pricing and promotions 3rd, chairman and chief executive officer. during December was that we were able to effec- 21 ACCESSORIES: Jewelry firm David Yurman is He added that throughout 2008, the company tively clear through seasonal merchandise, and introducing its newest men’s watch, The Classic, “took steps to significantly reduce our invento- end the year with a clean inventory position. We featuring the brand’s first round case. ries and operating expenses in order to with- ended the quarter with total inventory down 10.5 28 Rebounding from steep discounts at the end of stand the impact of the economic conditions. percent, and aligned with expected sales trends last year, retail prices for apparel rose 0.3 percent At the same time, we stepped up the style we over the near term.” in January, the U.S. Labor Department said. offer and focused on effectively communicat- In addition to the per-share loss it expects in ing the newness, excitement and value in our the first quarter, Penney’s projected a first-quar- EYE merchandise, as well as engaging and enabling ter sales decline of 10 to 13 percent, as well as a 16 our associates to provide a rewarding shopping comps decrease of 12 to 15 percent. The stars were out and celebrating during Oscars experience to our customers. Looking ahead, Mindful of firms’ travel budgets, the retailer weekend, from the pre-parties in the Hollywood we are dedicated to remaining one of the best said it will host its annual analysts’ meeting in Hills to the red carpet at the Kodak Theatre. capitalized retailers and continuing to show our New York on April 22 instead of Plano, Tex., as Donna Karan customers why they should choose J.C. Penney it has in the past. above all others.” The company ended the year with cash in- Classified Advertisements...........................................................................................30-31 Ullman told Wall Street analysts during a con- vestments of $2.4 billion and long-term debt of TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS ference call, “We are well positioned to navigate $3.5 billion. It has no debt maturities in 2009, a [email protected], USING THE INDIVIDUAL’s NAME. through an economic environment that remains $500 million maturity in 2010 that can be retired WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2009 very challenging. By continu- using existing cash on its FAIRCHILD FASHION GROUP. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. ing to focus on our Bridge Plan, For more on the company’s balance sheet, and no ma- VOLUME 197, NO. 39 . WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with we’ll be able to handle the initiatives, see WWD.com turities in 2011. one additional issue in January, May, October, November and December, two additional issues in April, June and August, three additional issues in March and September, and four additional issues in February) by Fairchild Fashion Group, which is a division of Advance Magazine Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services provided by Condé Nast Publications: S. I. Newhouse, Jr., Chairman; Charles H. Townsend, President/CEO; John W. Bellando, Executive Vice President/COO; Jill Bright, Executive Vice President/Human Resources. Periodicals postage paid at New York, NY, and at additional mailing offices. Canada Post Publications Mail Agreement No. 40644503. Canadian Goods and Services Tax Registration No. 886549096-RT0001. Canada Post: return undeliverable Canadian addresses to: P.O. Box 503, RPO West Beaver Cre, Rich-Hill, ON L4B 4R6 POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P.O. Box 15008, North Hollywood, CA 91615–5008. FOR Earnings Season to Test Retail Lows SUBSCRIPTIONS, ADDRESS CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 15008, North Hollywood, CA 91615-5008, call 800-289-0273, or visit www.subnow.com/wd. Please give both new By Alexandra Steigrad and Matthew Lynch shedding 6.2 percent, or 484.74 points. The Dow and old addresses as printed on most recent label. First copy of new subscription will be mailed within four weeks is down almost 50 percent in the last 16 months. after receipt of order. Address all editorial, business, and production correspondence to WOMEN’S WEAR DAILY, 750 WHERE is thE BOttOM FOR REtail stOcks The S&P 500 fell below 800 for the first time this Third Avenue, New York, NY 10017. For permissions and reprint requests, please call 212-630-4274 or fax requests to 212-630-4280. Visit us online at www.wwd.com. To subscribe to other Fairchild magazines on the World Wide Web, as the broader market sinks deeper into a six- year to close the week at 770.05, down 6.9 percent visit www.fairchildpub.com. Occasionally, we make our subscriber list available to carefully screened companies that year low? or 56.79 points.
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