LONDON HE ADING ALL ABOUT WEST ACCESSORIES INSPIRATIONS NATALIE RATABESI WHAT DESIGNERS SAY ABOUT JOINS VINCE IN LONDON MEN’S BRANDS SAY L.A. AS CREATIVE THEIR FALL COLLECTIONS FOR ACCESSORY SALES ARE BOOMING, DIRECTOR AFTER AND THEY’RE FOCUSING ON THE LONDON COLLECTIONS: MEN. EXITING HER POST CATEGORY MORE THAN EVER. PAGES MW2 AND MW3 AT PHILOSOPHY IN PAGE MW1 MILAN. PAGE 2 THE ‘MICKEY PREMIUM’ J. Crew’s Challenge: What’s It Worth? By EVAN CLARK WHAT MIGHT BE J. CREW GROUP’S greatest asset — the exacting and merchandising-infused leadership of Millard “Mickey” Drexler — has become something of a complication for the company’s private equity owners as they consider selling the retailer. THURSDAY, JUNE 5, 2014 ■ $3.00 ■ WOMEN’S WEAR DAILY Drexler, the driving force behind Gap Inc.’s suc- WWD cess in the Nineties, is the rare executive who’s seen as having the magic touch by both Wall Street and the fashion crowd. His hands-on approach and ability to pick product helped put J. Crew back on the map when he took the helm as chief executive offi cer and chairman in 2003. And he will be a very diffi cult man to replace when he decides to step down. Especially now that the company is experiencing a period of slower growth. Late Wednesday, J. Crew said refi nancing costs pushed it to a loss in the fi rst quarter, while adjusted earnings fell and comparable company sales declined 2 percent (after 5 percent growth a year earlier). It was J. Crew’s promise under Drexler that attract- ed deep-pocketed investors TPG and Leonard Green Spot & Partners, who teamed up with the ceo to take the retailer private in 2011 for $3 billion — a price that refl ected what might be called a “Mickey Premium.” They bought not only the company, but Drexler’s stew- 2015 ardship and aura. Drexler, 69, got a bigger piece of the action as his stake in the business grew to an estimat- ed 20 percent, according to sources. On RESORT “Is Mickey Drexler to J. Crew what Steve Jobs was A simple palette of to Apple?” asked one retail observer, noting the answer was a defi nite, “yes.” “What Mickey Drexler is, is vision.” navys and whites, But how much is that vision worth when Drexler might punctuated with gold, only remain in his role for a few more years after a sale? grounded Ralph Lauren’s The Japanese parent of Uniqlo, Fast Retailing Co. Ltd., had been in early talks to buy J. Crew, but re- resort collection in elegant modernity. He portedly balked at the $5 billion price tag proposed worked pretty graphics via polka dots, by TPG and Leonard Green. And Fast is one of only a stripes and colorblocking on elevated SEE PAGE 8 fabrics such as this silk turtleneck paired with crepe de chine pants. For more on resort, see pages 4 and 5. Bangladesh, Cambodia Imports Hit by Unrest By KRISTI ELLIS WASHINGTON — Cambodia and Bangladesh are beginning to feel the bite from the upheavals taking place in their apparel-manufacturing industries. On Wednesday, U.S. Labor Department offi cials held a conference call with fashion industry trade groups about instability in Cambodia’s garment in- dustry, according to industry sources. At the same time, the Commerce Department released its month- ly trade report, showing that apparel imports from Cambodia and Bangladesh tumbled in April. The heightened scrutiny follows months of protests and strikes by Cambodian garment workers and union leaders who have been calling for an increase in the country’s minimum wage to $160 a month from the current rate of $100 a month. A nationwide strike in Cambodia turned deadly on Jan. 3, when Cambodian security forces opened fi re on thousands of workers, leaving fi ve dead and injur- ing more than 40 people. Nate Herman, vice president of internation- al trade at the American Apparel & Footwear Association, said Obama administration offi cials have been in conversations with the Cambodian govern- ment to address the issues. “A lot of the focus has been on labor laws in Cambodia and the treatment of unions…and moving industrial rela- tions forward to try to improve labor laws,” Herman said. A series of meetings in Cambodia last week and a PHOTO BY JOHN AQUINO court’s decision to convict — then free — 23 people SEE PAGE 8 2 WWD THURSDAY, JUNE 5, 2014 WWD.COM PVH’s Q1 Shy of Wall Street’s Estimates THE BRIEFING BOX sales to $1.87 billion from $1.82 gic investments. IN TODAY’S WWD By VICKI M. YOUNG billion. The balance of revenues According to the company, was from royalty income and ad- revenue in the Calvin Klein busi- NEW YORK — Shares of PVH vertising and other income. ness rose 9 percent to $665 mil- Corp. slipped in after-hours trad- Wall Street analysts on aver- lion from $608 million. On an Olivia Palermo at ing Wednesday following the age were expecting adjusted adjusted basis, excluding $30 mil- the CFDA Fashion firm’s posting of first-quarter re- earnings per share at $1.49 on lion in sales returns, revenues a Awards. For more sults that were just shy of Wall revenues of $1.98 billion. year ago for the Calvin Klein celebrity fashion, Street’s consensus estimates. Emanuel Chirico, chairman business would have been $638 see WWD.com. The shares inched up 0.3 and chief executive officer, said, million. In the Tommy Hilfiger percent Wednesday to close “We are pleased with our first- business, revenues increased at $130.68 in Big Board trad- quarter results, which were in 6 percent to $862 million from ing, but then fell 6.6 percent in line with our expectations.…” $811 million. The increases were early after-market trading on the He noted that the global mac- partially offset by a revenue de- Nasdaq to $122. roeconomic challenges in the cline of 2 percent in the firm’s IMAGES For the three months ended retail environment from the first Heritage Brands business, ex- May 4, the company posted $35.3 quarter have continued into the cluding the $47 million of 2013 MAX/GC million in net income, or 42 cents second three-month period, and Bass revenue. a diluted share, against a $10.3 said, “[W]e believe our North For the year, the company’s million net loss, or 13 cents, a American businesses will experi- EPS guidance is in the range NCP/STAR year ago. Excluding certain ad- ence margin pressure in the sec- of $7.30 to $7.40 on a non-GAAP BY justments, such as the integra- ond quarter and we have lowered basis, reflecting a $10 million in- PHOTO tion of The Warnaco Group Inc. our full-year earnings per share crease in Calvin Klein advertis- and related restructuring charg- guidance to reflect this. We will ing expense over the prior year. es, plus the costs incurred re- continue to make the previously Revenue is estimated to grow 5 J. Crew Group Inc.’s owners face a Millard “Mickey” Drexler lated to the sale of the G.H. Bass planned strategic investments, percent to $8.5 billion, excluding conundrum as they consider cashing out. PAGE 1 business, among others, net in- particularly in the acquired $176 million in revenues from the come was $122.1 million or $1.47 Calvin Klein businesses, in order Bass business. Cambodia and Bangladesh are feeling the bite from the a diluted share, versus $155.6 to unlock the full global potential For the second quarter, EPS is upheavals in their apparel manufacturing industries. PAGE 1 million, or $1.91, a year ago. of the Calvin Klein businesses expected in the range of $1.40 to Total revenues for the quarter over the long term.” $1.45 on a non-GAAP basis, with PVH Corp. on Wednesday posted first-quarter results that rose 2.8 percent to $1.96 billion Chirico explained that the revenues forecasted at $2 billion, were just shy of Wall Street’s consensus estimates. PAGE 2 from $1.91 billion, which includ- first half of fiscal year 2015 will excluding $62 million related to ed a 2.7 percent increase in net be pressured by the firm’s strate- the Bass business. Natalie Ratabesi has been tapped as creative director of women’s design at Vince. PAGE 2 Vince Names Ratabesi Creative Director Joe Fresh has opened its first unit in Asia — a two-level store in the Myeongdong shopping district in Seoul. PAGE 6 to have someone who can be full-time in L.A. and By LISA LOCKWOOD provide leadership to the women’s design teams Spanish footwear firm Camper has named Romain Kremer its under the continuing guidance of Karin.” first creative director. PAGE 6 NATALIE RATABESI, who stepped down as cre- Reached for comment in Milan, Ratabesi said ative director of Philosophy last month, has been she made the decision to take the Vince position Chanel reprised its Paris-Dallas Metiers d’Art runway show in tapped as creative director of women’s design at after having several meetings with Gregersen and Tokyo, building an expansive Texas saloon-style set. PAGE 6 Vince, the contemporary sportswear firm. Granoff. “I just loved the excitement they had when She begins June 16 and will relocate from Milan they talked about this brand — their growth and New Balance has alleged that Karl Lagerfeld has stepped too to Vince’s design studio in Los Angeles. how they want to take it to another level,” she said.