Bottled Water
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PRE-FALL MORE TROUBLE PITTI 2014 FOR SEARS ACTION ELIZABETH AND JAMES THE EMBATTLED BUSINESS WAS AND GILES WERE RETAiler’s HOLIDAY BOOMING AT IN THE SPOTLIGHT THE TRADE FAIR COMPS FELL IN FLORENCE. AS PRE-FALL NEARS 7.4 PERCENT. PAGE 2 ITS END. PAGE 3 PAGE 9 THE LONG LIZ WIND-DOWN McComb Era Ends, Kate Spade Steps Out By LISA LOCKWOOD NEW YORK — William L. McComb, chairman and chief executive officer of Fifth & Pacific Cos., is step- ping down after seven years at the helm. He will be succeeded by Craig Leavitt, ceo of Kate Spade. F&P will undergo a name change to Kate Spade & Co., to FRIDAY, JANUARY 10, 2014 ■ $3.00 ■ WOMEn’s WEAR DAILY reflect the company’s monobrand focus. WWD It’s been a controversial tenure for McComb, who oversaw the transformation of the company, which was previously known as Liz Claiborne Inc. When McComb took over in November 2006, Claiborne had about 40 brands and $4.99 billion in sales. After a portfolio review, McComb quickly put 16 of the com- pany’s brands on the block — including Ellen Tracy, Dana Buchman and Sigrid Olsen — and reoriented the firm around four “power brands,” which were Kate Spade, Juicy Couture, Lucky Brand jeans and Mexx. The firm, which last year generated about $1.3 billion in revenues and has a market capitalization of $3.96 billion, also sold its namesake Liz Claiborne brand to J.C. Penney Co. Inc., which had the license, Bottled and has since sold Mexx. “All told, I was a wartime ceo,” said McComb, in a telephone interview Thursday. “Any of us that led our companies through that very rough time in the world.…We had our own travails that had nothing to Water do with the external market. You put those two to- Bulgari is harnessing the gether, and to hold a board together and to hold all the constituents like the banks and even the invest- power of the sea for its ment community, it’s not easy. Did we make mistakes? newest men’s fragrance, Sure, but there were also things we had to do.” Following the sale of Juicy Couture and the com- Aqua Amara, a citrus pletion of the Lucky Brand jeans deal this year, the successor to the original company will be left with just one brand: Kate Spade, Aqua Pour Homme, which generated $742 million in sales last year. In establishing the company, George Carrara, which was launched currently executive vice president, chief operat- in 2004. In the U.S., ing officer and chief financial officer of F&P, will be the fragrance will be SEE PAGE 12 carried in about 2,000 department and specialty store doors. Globally, Dsquared2 Wins Key it could do as much as $34 million at retail in China Trademark Case its first year on counter. By LUISA ZARGANI For more, see page 4. MILAN — Dsquared2 won its battle for China. The brand secured the rights to distribute its col- lections in the country as a court in Hangzhou ruled it is “legitimately allowed” to do so — despite the fact that another company has trademarked the Dsquared label (without the 2 figure) and is selling counterfeit products under that moniker. The ruling is vital to the brand’s prospects in the gigantic consumer market and an important signal that Western brands can successfully argue their cases in the still-evolving Chinese legal system. Dsquared2 was initially denied permission to trade- mark the brand in China in 2005 because the Nuohe group had registered the label three months earlier. “We are facing a serial usurper,” Roberto Franco, chief financial officer of Dsquared2, told WWD. “This verdict marks an epochal turnaround because it says that Dsquared’s lettering and format is legitimate in China even if there is another brand registered under the same name.” According to Franco, Nuohe has registered in China more than 200 brands, including such names as C’N’C’, Dior Homme and Iceberg. “After we had gone through all the possible administrative levels, in 2011 we decided to sue Nuohe for registration in bad faith and unfair competition and turned to the court of Hangzhou, which is known for its more modern views on intellectual property in China,” said Franco. The executive said Nuohe has opened stores copy- PHOTO BY JOHN AQUINO, STYLED BY SHARON BER ing the brand’s products and lettering and the original SEE PAGE 8 2 WWD FRIDAY, JANUARY 10, 2014 WWD.COM Sears Holiday Comps Tumble THE BRIEFING BOX percent from 58 percent during the sured both margins and profits. IN TODAY’S WWD By ARNOLD J. KARR comparable 2012 months. SYW ex- The trend lines were friend- pense increased $69 million during lier to Abercrombie & Fitch Co., SHARES OF Sears Holdings Corp. the first two months of the quarter. which prepared investors for a fell almost 13 percent in after- Noting its efforts to spin off tough quarter back in November. Street style during hours trading Thursday following its Lands’ End and Sears Auto It reported that its comps, in- London Collections: the company’s discouraging report Center businesses, the company cluding e-commerce, were down 6 Men. For more, see on its declining same-store sales. said it had approximately $1 bil- percent so far in the quarter, with WWD.com. Sears said in its comparable- lion of cash on its balance sheet a 4 percent decline in the U.S. store sales in November and with $2.3 billion in availabil- helping to balance a 10 percent December were down 7.4 percent, ity through its credit facilities, decrease in international markets. with Sears’ U.S. stores off 9.2 per- about $500 million of it through Abercrombie originally antici- cent and Kmart’s off 5.7 percent. its Sears Canada facility. pated a low-double-digit decline The figures are worse than those “We continue to reduce unprof- in comps during the quarter. registered for the first 11 months itable stores as leases expire and Assuming comps below the quar- of the fiscal year, which have the in some cases accelerate closings ter-to-date trend in January, the company down 3.9 percent, Sears when circumstances dictate,” the firm now expects adjusted net in- down 4.2 percent and Kmart down firm said. come for the full year of between DABROWSKI 3.7 percent. The firm pinpointed $1.55 and $1.65, 15 cents above the declines in consumer electron- previous range estimates. That KUBA ics, tools and home appliances in implies fourth-quarter adjusted BY its Sears stores and decreases in net income of between 96 cents PHOTO consumer electronics, grocery and 12.6% and $1.06 a share in the fourth household, and toys at Kmart. quarter, better than the 89 cents For the fourth quarter ending AFTER-HOURS PRICE DECLINE OF expected, on average, by analysts. William L. McComb, chairman and chief executive officer of Feb. 1, the firm now anticipates a SEARS SHARES THURSDAY. Shares jumped 14.4 percent, Fifth & Pacific Cos. Inc., will be leaving the company after seven net loss of between $250 million and to $38, in after-hours trading. years at the helm. PAGE 1 $360 million, or between $2.35 and They were up 0.9 percent to $3.39 a diluted share, lighter than The news from Sears came at $33.21 during the day. Dsquared2 won a trademark dispute in a Chinese legal court, Aéropostale Inc. didn’t dis- the loss of $489 million, or $4.61, reg- the end of a 24-hour period in clearing the way for its expansion in the country. PAGE 1 istered during the comparable pe- which many former participants close results along with its teen riod last year. Stripping out a series in the monthly ritual of same- sector peers but became a subject of nonrecurring items, adjusted net store sales reporting returned of heightened speculation after it Target next month will introduce a premium skin-care loss would be between $213 million to the fray with holiday updates. canceled plans to appear at the assortment stocked with seven brands culled from different PAGE 4 and $316 million versus and adjust- That virtually drowned out a col- ICR XChange in Miami next week. retail channels and countries. ed net loss of $119 million last year. lection of disappointing monthly With recent results weak and its Removing a myriad of other reports from stores including Gap stock in retreat — shares declined Bulgari is introducing a new men’s fragrance the company items, the company said its earn- Inc., L Brands Inc., The Buckle 30.1 percent last year — Wall says has staying power: Aqua Amara, a citrus successor to the ings before interest, taxes, depre- Inc. and Zumiez Inc., all of which Street’s attention turned to a pos- original Aqua Pour Homme. PAGE 4 ciation and amortization would fell below the comp levels ex- sible takeout of the chain. Several range from a profit of $65 million pected by analysts surveyed by private equity firms — including Olay next week will launch a marketing campaign that cuts to an EBITDA loss of $65 million, Thomson Reuters. Sycamore Partners, Hirzel Capital across all its subbrands called “Your Best Beautiful.” PAGE 4 whereas adjusted EBITDA for the Following Macy’s Inc.’s word Management and Crescendo comparable quarter last year, upon late Wednesday of a 3.6 percent Partners — have picked up stakes The China beauty market is maturing at a rapid pace, causing the exclusion of $878 million in im- increase in comps for November in the retailer and urged it to take growing pains for multinational beauty firms.