- Prachi Singh |
Fourth quarter revenue at PVH of 2.1 billion dollars was flat compared to the prior year period. Revenue for 2016 increased 2 percent and 4 percent on a constant currency to 8.2 billion dollars compared to the prior year. The company said, 2016 EPS exceeded guidance and on GAAP basis was 1.26 dollars in the fourth quarter and 6.79 dollars for the full year. Non-GAAP was 1.23 dollars in the fourth quarter and 6.80 dollars for the full year.
Commenting on these results, Emanuel Chirico, Chairman and CEO, said in a statement, “We are very pleased with our fourth quarter results, which exceeded both our sales and earnings guidance despite the volatile macroeconomic environment and the highly promotional retail market in the US. We continued to demonstrate strong momentum in our Calvin Klein and Tommy Hilfiger businesses.”
Fourth quarter business segment review
Revenue in the Calvin Klein business for the quarter decreased 1 percent to 795 million and was flat on a constant currency basis compared to the prior year period. PVH said this includes a reduction of approximately 25 million dollars resulting from the November 2016 deconsolidation of the company’s subsidiary that principally operated and managed its Calvin Klein business in Mexico in connection with the formation of a joint venture in Mexico.
Calvin Klein International revenue increased 11 percent to 385 million dollars and increased 14 percent on a constant currency basis compared to the prior year period, including a 6 percent increase in comparable store sales, due to continued strong performance in Europe and China. Calvin Klein North America revenue decreased 11 percent, also on a constant currency basis to 409 million dollars. North America comparable store sales decreased 2 percent.
Revenue in the Tommy Hilfiger increased 3 percent to 932 million dollars and 5 percent on a constant currency compared to the prior year period. Tommy Hilfiger international revenue increased 10 percent or 14 percent on constant currency to 513 million dollars driven by positive performance in Europe, including a 7 percent increase in comparable store sales, and the April 2016 acquisition of the 55 percent interest in the company’s former joint venture for Tommy Hilfiger in China.
Tommy Hilfiger North America revenue decreased 4 percent, also on a constant currency basis to 419 million dollars due to a 7 percent comparable store sales decline and the discontinuation of the company’s directly operated womenswear wholesale business in the US and Canada during the quarter in connection with the licensing of this business to G-III Apparel Group.
Revenue in the Heritage Brands business for the quarter decreased 5 percent to 381 million dollars compared to the prior year period, principally resulting from the discontinuation of several licensed product lines in the dress furnishings business. Comparable store sales were flat compared to the prior year.
Earnings per share for the quarter was 1.26 dollars on a GAAP basis compared to 1.63 dollars in the prior year period. Earnings per share were 1.23 dollars on a non-GAAP basis compared to$1.52 in the prior year period. Earnings before interest and taxes on a GAAP basis for the quarter decreased to 154 million dollars compared to 176 million dollars in the prior year period. Earnings before interest and taxes on a non-GAAP basis for the quarter was 147 million dollars compared to 183 million dollars in the prior year period.
Full year revenues rose 2 percent
Revenue for 2016 increased 2 percent and 4 percent on a constant currency to 8.2 billion dollars compared to the prior year. The company said, revenue change was due to a 7 percent or 9 percent increase on constant currency in the Calvin Klein business compared to the prior year, driven by the continued significant growth in Europe, China and the North America wholesale business, partially offset by a decrease due to the Mexico deconsolidation.
International comparable store sales increased 6 percent, while North America comparable store sales decreased 4 percent, primarily driven by declines in traffic and consumer spending in Calvin Klein’s US stores located in international tourist locations. The company reported a 4 percent or 5 percent increase on constant currency in the Tommy Hilfiger business compared to the prior year, driven principally by strong growth across Europe, including a 9 percent increase in comparable store sales, and the inclusion of the revenue of the China business after completion of the TH China acquisition in April 2016.
Tommy Hilfiger North America comparable store sales declined 9 percent, driven by weak traffic and consumer spending in Tommy Hilfiger’s US stores located in international tourist locations. Also negatively impacting Tommy Hilfiger North America revenue was the discontinuation of the company’s directly operated women’s wear wholesale business in the US and Canada in connection with the G-III license.
A 10 percent decrease in the Heritage Brands business compared to the prior year, principally driven by the rationalization initiatives in the business, partially offset by a 7 percent increase in comparable store sales.
Earnings before interest and taxes on a GAAP basis for 2016 increased to 789 million dollars compared to the prior year of 761 million dollars due in large part to a net gain of 76 million dollars. Earnings before interest and taxes on a non-GAAP basis was 794 million dollars, inclusive of a 145 million dollars negative impact due to foreign currency exchange rates, compared to 842 million dollars in the prior year.
Forecasts 5 percent revenue growth for Calvin Klein in FY17
In FY17, the company expects GAAP EPS to range between 6.20 dollars to 6.30 dollars and from 0.73 dollar to 0.75 dollar in the first quarter. On non-GAAP basis, EPS is expected to range between 7.30 dollars to 7.40 dollars for the full year and 1.58 to 1.60 dollars in the first quarter.
PVH said negatively impacting the revenue in 2017 as compared to 2016 is a decrease due to the Mexico deconsolidation, which resulted in the company no longer recognizing revenues from a directly operated business in Mexico, and a decrease due to the G-III license, which resulted in the discontinuation of the company’s directly operated women’s wear wholesale business in the US and Canada in the fourth quarter of 2016.
Full year revenue for the Calvin Klein business is projected to increase approximately 5 percent or approximately 7 percent on a constant currency basis, which includes the negative impact of the Mexico deconsolidation. Revenue for the Tommy Hilfiger business is projected to increase approximately 1 percent or approximately 4 percent on a constant currency basis, which includes the negative impact of the G-III license. Revenue for the Heritage Brands business is projected to decrease approximately 1 percent.
Revenue in the first quarter of 2017 is projected to increase approximately 2 percent or approximately 4 percent on a constant currency basis compared to the prior year period. Negatively impacting revenue, the company said, is a reduction in revenue resulting from the Mexico deconsolidation and the G-III license, partially offset by an increase in revenue from the Tommy Hilfiger China business, which was acquired in April 2016, as the first quarter of 2017 will include a full quarter of revenue, while the first quarter of 2016 included less than one month of revenue.
Revenue for the Calvin Klein business in the first quarter is projected to increase approximately 3 percent or approximately 5 percent on a constant currency basis, which includes the negative impact of the Mexico deconsolidation. Revenue for the Tommy Hilfiger business is projected to increase approximately 4 percent or approximately 8 percent on a constant currency, which includes an increase in revenue from the Tommy Hilfiger China business, partially offset by the negative impact of the G-III license. Revenue for the Heritage Brands business is projected to decrease approximately 3 percent.
Picture:Calvin Klein website
- Vivian Hendriksz |
London - It may have been a difficult year for some, but for Jeff Bezos, CEO of online giant Amazon, it was his best year yet - at least in terms of money. No other billionaire in the world saw their fortunes increase like Bezos, who saw his net worth grow by a staggering 27.6 billion dollars - more than the total net worth of all but the top 24 richest billionaires, according to Forbes 2017 World's Billionaire list.
Bezos currently holds a net worth of 72.8 billion dollars, making him the third richest billionaire in the planet after Microsoft's Bill Gates and Warren Buffett. The past year saw Bezos enter Forbes World's Billionaires top 10 ranking for the first time and thanks to his most successful year to date, Bezos has climbed two spots up, firmly securing 3rd place. Part of Bezos net worth boost is linked to Amazon's stock, as Bezos owns close to 17 percent of Amazon.com
CEO at Amazon sees net worth grow 27.6 billion dollars
Over the past year Amazon's stock price grew 67 percent over the last year due to its successful cloud-computing unit, Amazon Web Services, ongoing investments in fashion as well as the ecommerce platform's push into new markets, like India. Seen as the leading ecommerce business, Amazon is said to be the fastest company in history to hit 100 billion dollars in annual sales, which it hit in 2015. Offering everything from fashion to books and homeware, the US online giant holds the largest market in its home town, accounting for 43 percent of all US online retail sales in 2016 according to Slice Intelligence.
As Amazon continues to grow its online market share in the US and overseas, the e-commerce company set its sights on dominating another market - fashion. The online company is expected to surpass Macy's as the biggest apparel seller in the US sometime this year, as Amazon continues to invest in developing its own private-label apparel brands and expanding its fashion offering to include higher end brands such as Stuart Weitzman and Zac Posen. The online company previously opened its own state of the art photography studio dedicated to fashion in Shoreditch London and is said to be developing its own private-label athleisure and plus-size offering as well.
In addition, Amazon recently launched a new tool on its app "Outfit Compare" which is designed to help Amazon Prime Members select what outfit they should wear for the day. The tool includes advice on fit, colour, styling and trends and is part of Amazon bid to boost its fashion offering.
Photos: Jeff Bezos, via Flickr
- Prachi Singh |
Online fashion portal Jabong has added American fashion brand Forever 21 to its product portfolio. The company said, Forever 21, which is the 5th largest specialty retailer in the United States, will be available on Jabong in variants across the apparel, accessories and footwear categories such as play-in tops, dresses, t-shirts, cosmetics, intimates and shoes with prices ranging from Rs 499 to Rs 2,400.
“Forever 21 is a pioneer and global leader in the fast fashion category and its addition will strengthen the comprehensive line of finely curated international portfolio on Jabong,” said Gunjan Soni, Head of Jabong in a statement.
“We are thrilled to launch on Jabong, which has carved a unique niche among the upmarket fashionistas of India who swear by the hottest international designs. The combined strengths of Jabong and Myntra help us cover a major share of the online fashion retail market and uniquely curate our products to cater to the shopper preferences on each platform” added Abhinav Zutshi, India Business Head, Forever 21.
With Forever 21, Jabong said, it has now added 20 new brands on its platform in March itself and will be taking the number to 35 by the end of this month. Brands added to Jabong this month include New Era Caps, Wrogn, Mothercare, Roadster, Cover Story, AAY, Zivame and Mast and Harbor. The platform has earlier introduced a multitude of international fashion brands in India such as Topshop, Topman, Dorothy Perkins, Missguided and Next among others.
Picture:Forever 21 via The Gutenber PR
- Prachi Singh |
Net profit at the French luxury goods player Hermes reached 1.1 billion euros (1.2 billion dollars) in 2016, a 13 percent increase over the year ago period, AFP reports. The company said that this jump in net profit can be attributed a 14 percent increase in its leather goods and saddlery segment. The company’s revenues surpassed a 5 billion euro mark (5.3 billion dollars).
"Development was supported by the sustained pace of deliveries and production, gaining from the capacities of the three new sites in France,” the company stated in a statement announcing the annual results, added the report.
Hermes posts like-for-like sales rise of 7.5 percent
Like-for-like sales increased 7.5 percent to 5.2 billion euros (5.6 billion dollars), while operating income grew 10 percent to 1.7 billion euros (1.8 billion dollars). The group said, it reached an operating margin of 32.6 percent, due to a favourable impact of foreign exchange hedges.
Product segment-wise, while perfume sales rose nine percent, apparel sales were flat on last year and and watch sales slowed by 3 percent. However, the company reported rise in sales in all geographical regions.
The company has announced a dividend payment of 3.75 euros (4.04 dollars) per share, up from 3.35 euros (3.61 dollars) last year.
- Prachi Singh |
Kering’s subsidiary Kering Eyewear and the Maison Cartier, owned by Compagnie Financière Richemont have decided to enter into a strategic partnership bringing their operations together to create a stronger platform for the development, manufacturing and worldwide distribution of the Cartier eyewear collection subject to clearance by antitrust authorities.
Under the terms of the agreement, Richemont will acquire a minority stake in Kering Eyewear, a specialised company fully dedicated to the eyewear activity of twelve brands including Gucci, Bottega Veneta, Saint Laurent, Alexander McQueen, Brioni, Christopher Kane, McQ, Stella McCartney, Tomas Maier, Boucheron, Pomellato and Puma under the Kering Group. Kering Eyewear will notably integrate the Manufacture Cartier Lunettes entity in Sucy-en-Brie, France.
The statement said that subject to closing, the Cartier 2018 Spring Summer collection, which will be presented during the forthcoming Silmo in Paris from October 6-9, 2017, will mark the official beginning of the partnership.
- Prachi Singh |
Nike said that consumer demand in all geographies drove revenue growth across the Nike brand portfolio in the third quarter. The company added that diluted earnings per share were up 24 percent and grew faster than revenue, primarily due to selling and administrative expense leverage, higher other net income, a lower effective tax rate and a lower average share count.
“The power of Nike’s diverse, global portfolio delivered another solid quarter of growth and profitability,” said Mark Parker, Chairman, President and CEO, Nike in a media statement, adding, “To expand our leadership and ignite Nike’s next phase of growth, we’re delivering a relentless flow of innovation through performance and style, increasing speed throughout the business and creating more direct connections with consumers leveraging digital and membership.”
Third quarter revenues up 5 percent
Revenues for Nike increased 5 percent to 8.4 billion dollars, up 7 percent on a currency-neutral basis. Revenues for the Nike brand were 7.9 billion dollars, up 7 percent on a currency-neutral basis, driven by double-digit growth in Western Europe, Greater China and the emerging markets as well as the sportswear and Jordan brand categories. Revenues for Converse were 498 million dollars, up 3 percent on a currency-neutral basis, driven by growth in North America.
The company said, gross margin contracted 140 basis points to 44.5 percent, as higher average selling prices were more than offset by higher product costs, unfavourable changes in foreign exchange rates and the impact of higher off-price sales. Net income increased 20 percent to 1.1 billion dollars and diluted earnings per share increased 24 percent to 0.68 dollar.
At February 28, 2017 inventories for Nike were 4.9 billion dollars, up 7 percent compared to the prior year as a 3 percent decrease in Nike brand wholesale unit inventories was offset by increases in average product costs per unit and higher inventories associated with growth in DTC.
- Vivian Hendriksz |
The fashion industry is an ever-changing sector where anything goes. One year, your brand could be the most coveted and desirable it-brand, the next year it could be on the brink of bankruptcy. However, there are a few famed fashion houses and retailers who have fought against the odds and continue to deliver designs that satisfy their consumers fickle desires year in and year out. And it is precisely these fashion and retail companies who have become the leading international powerhouses, generating billions of dollars in revenue. But who are the entrepreneurs, the men and women behind these fashion empires, who continually manage to defy the fashion odds and increase their net worth year after year? Has Amancio Ortega managed to hold on to his title as the wealthiest man in fashion? Or has he been overtaken by another fashion mogul?
FashionUnited examines the net value and assets of the Top 10 Richest Billionaires in Fashion based on Forbes annual World’s Billionaire ranking and shares its findings in the StoryMap below.
Click the button 'Start Exploring' to get started. Use the arrows to navigate through our map or simply click on the icons on the world map to learn more.
FashionUnited is set to publish its own Richest People in Fashion List H1 2017 in June.
- Meenakshi Kumar |
Flipkart will close the current financial year with a sales growth of close to 40 per cent over the last fiscal. The e-commerce major expects to witness a much larger growth in 2017-18 as it is seeing a good traction in sales across several categories. It expects to clock sales growth of up to 60 per cent in financial year 2018.
Over the last few months, Flipkart has expanded in Tier II and Tier III cities. Flipkart has a customer base of 100 million. In 2016, around 65 per cent of Flipkart’s new customers came from Tier II and Tier III cities. Smart phones give Flipkart 50 per cent of its sales. Other promising categories are large appliances, furniture and food and grocery.
Flipkart has added 50 additional delivery hubs and added 1,000 new pin codes across the country, largely in Tier II and III cities. During the next fiscal, it intends to add another 1,000 pin codes to its network and set up 60 additional delivery hubs, mainly in secondary cities. It is also expanding the delivery capabilities of its logistics subsidiary Ekart.
Currently, Ekart has a network of over 400 delivery hubs. It currently delivers 85 per cent of Flipkart’s daily shipments. Going forward, Flipkart will continue to make use of third-party logistics providers for some of its operations.
- Prachi Singh |
Luxury label Valentino has crossed the 1 billion euros (1.07 billion dollars) revenue mark in 2016, says a report by Fashion Network. After the label was acquired by private equity firm Mayhoola in 2012, the company that also took over Balmain last year, it had set a target of hitting one billion mark in five years and the label has posted growth every year following the acquisition.
For the fiscal year, the company’s sales stood at 1.11 billion euros (1.19 billion dollars), up 12.4 percent compared 47 percent jump in sales last year, the report added. The company’s EBIT reached 206 million euros (221 million dollars), up 14.4 percent on the last year with a margin of approximately 18 percent of total sales.
The company globally operates 175 mono-brand stores of the brand and its retail sales account more than half (55 percent) of the total revenues. The company aims to open doors to around twenty new stores this year, some of which would be dedicated to menswear, a fast-growing segment under the brand that contributes around 200 million euros (215 million dollars) in revenue. Fashion accessories also account for 50 percent of the label's total turnover.
The company’s growth momentum was backed by its 275 million dollars to 330 million dollars investment into building the retail store network, while focusing its wholesale network to sell Valentino products at high-end boutique stores. After Maria Grazia Chiruri’s exit as the co-creative director, Valentino’s collections are now solely managed by its current Creative Director Pierpaolo Piccioli.Picture:Valentino website
- Meenakshi Kumar |
After witnessing lull in demand, online portals are back on growth track and have started regaining market share over the past year on the back of an improved brand assortment and easier browsing experience. Interestingly, growth is led by Myntra. Companies such as Myntra, Voonik, Limeroad and Nykaa are seeing strong demand among online shoppers whereas sales growth in fashion at Amazon and Flipkart has slowed over the past year. Snapdeal, which is facing a cash crunch after struggling to raise fresh funds, has seen a sharp drop in fashion sales over the past year, according to fashion brands and e-commerce executives.
Myntra going strong
Myntra is on track to exceed its target of Rs 5,000 crores in gross merchandise value (GMV) for the year ending March 31; 80 per cent higher than its GMV in the previous financial year, chief executive Ananth Narayanan said in an interview last month. Myntra had earlier lost market share to its parent Flipkart as well as Amazon India after it became an app-only platform in May 2015. Starting January 2016, however, the company has been getting back market share and registering rapid sales growth by improving its product selection, including its private label offering, and designing a better browsing experience. The retailer also got a boost from re-opening its desktop and mobile websites last June. Myntra has now forecast sales growth of 40 per cent at Jabong in the next financial year.
Limeroad’s growth strategy
LimeRoad, which gets 70 per cent of its business from women customers, said its GMV jumped nearly four times in 2016 from the previous year. According to the CEO Suchi Mukherjee, LimeRoad core emphasis has always been on user engagement. This in large part is driven by exclusive content posted by our community together with our hyper-personalised algos. LimeRoad is the only platform in the fashion e-tailing industry, which offers the users services beyond just discounts – the curated looks and stories which assist the user in discovering delightful products at amazing prices.
Analysing the current demand dynamics, Sreedhar Prasad, partner, e-commerce and start-ups at KPMG India, says there might be heartburn for larger market places in the short-term because Myntra is emerging as a brand with a clear identity and is winning customers who are fashion seekers. They are emerging as a fashion destination or an aggregator of fashion brands (rather) than a marketplace. The rise of specialty retailers also throw up questions over whether Flipkart, which owns Myntra and another fashion retailer Jabong, will end up hurting sales at its two units. Flipkart has identified fashion as one of its key growth drivers this year.
Flipkart and Myntra both consider Puma and United Colors of Benetton among their five-largest selling brands. Recently Flipkart’s fashion head Rishi Vasudev said that Flipkart and Myntra catered to different audiences with ‘negligible’ customer overlap. Flipkart’s focus is to offer the widest range of products and sell to the masses whereas Myntra generates a majority of its sales selling pricier goods to so-called fashion seekers. Myntra’s private label business is another differentiator, contributing up to 30 per cent of its sales. One of Myntra’s private brands, Roadster, is the biggest-selling product on the platform.
Meanwhile Amazon India is focussing on both mass products as well as luxury brands. Amazon has added premium brands such as Aeropostale, M&S, Michael Kors and Emporio Armani to attract fashionistas, apart from offering lower-priced brands. According to Amazon India spokesperson, in just three years of launch, the company has successfully built the largest online fashion store with over 2 million fashion products from over 15,000 brands. The store is among the top three stores on Amazon.in and is one of the fastest growing stores on the platform. It continues to grow aggressively in terms of business and has been growing at over 150 per cent (year-on-year). Amazon Fashion is also a magnet category that contributes about 30 per cent of new Amazon.in customers and has consistently been doing this quarter-on-quarter.
Amid all the growth trends of arch arrivals, Snapdeal’s focus for 2017 is to build fashion as an important vertical. Vishal Chadha, senior vice-president, business at Snapdeal, highlighted that with the recent addition of close to 100 new brands including some prominent national and international names to itd fashion portfolio, the company is confident that this expansion will help them achieve the goal of making Snapdeal a one-stop shop for all fashion trends and style needs.