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Tag: BCBG

  • Global Brands Group posts massive US$598 million loss

    Global Brands Group posts massive US$598 million loss

    Global Brands Group has reported a net loss attributable to shareholders of US$598 million in the year to March.

    That followed a loss of $400 million the prior year, but the company claims its restructuring program involving axing brands and stores is paying off, citing a pre-tax profit of $151 million for the year.

    Group sales fell 28.5 percent to $US1.082 billion, but the company cut $209 million in operating costs

    Last year, Global Brands ditched a raft of brands in the US, including Copper Fit, Kenneth Cole, Juicy Couture, Jones New York, BCBG, Goats and Taryn Rose and also shuttered brick-and-mortar stores there.

    But it noted, “exciting progress” of new and emerging brands including B New York, Magna Ready, which produces clothes for people with disabilities, and sports & swimwear labels Saga (pictured above) and Dakine.

    “During the reporting period, we have experienced one of our most rewarding and yet, one of our most challenging years,” said CEO Rick Darling. “Throughout the fiscal year 2020, we have diligently focused on executing our restructuring program, and this dedication has resulted in strengthening our balance sheet and in improving our performance despite the unprecedented impact of Covid-19.”

    The brand shake-up, reduced low-margin sales, and negotiation of new supply agreements helped boost the company’s gross margin by more than 640 base points from 30.2 percent last year to 36.6 percent this year. Another factor in the improved margin was a focus on expanding its direct-to-consumer business model.

    Darling said the rapid spread of Covid-19 in February and March negatively impacted the group’s sales during the last quarter. But he believes the restructuring process the company has been through during the last two years has equipped the company to face the ongoing challenges of the pandemic, leaving it “well-positioned for growth going forward”.

  • Global Brands Group profit jumps high

    Global Brands Group profit jumps high

    Despite a slight revenue dip, Global Brands Group Holding has almost doubled its first-half operating profit.

    Its total margin continued its upward trajectory, increasing from 28.3 to 30.5 per cent, primarily because of sourcing optimisation.

    As a result of the increased total margin and lower running costs, operating profit for the period to the end of September increased by 94.1 per cent to US$80 million.

    However, revenue eased by 3.2 per cent year on year to $1.7 billion. The branded apparel, footwear and fashion accessories company says this was largely a result of a shift of retail buying to later in the year, as well as the anticipated end of the Quiksilver children’s fashion licence because of the company’s bankruptcy, and Coach taking its footwear business in-house following the expiration of its licence in June.

    “The global retail industry continues to experience a structural transformation, with consumers becoming progressively more powerful when it comes to defining their shopping experience,” says Global Brands CEO/vice-chairman Bruce Rockowitz. To meet ever-changing expectations, he says brands are increasingly looking to work with licensing partners such as Global Brands because of their product expertise, global platforms and multi-channel distribution networks.

    “The industry has seen a growing number of specialised brand investors continue to acquire brands, while looking to separate intellectual property (IP) ownership from brand operations.

    Global Brands has continued to benefit from this trend and has forged an increasing number of long-term licensing agreements with these IP owners.”

    During the reporting period, these notably included the BCBG and Bebe brands.

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  • BCBG Max Azria bankruptcy is on process

    BCBG Max Azria bankruptcy is on process

    BCBG Max Azria has filed for bankruptcy protection.

    The filing is the latest step in a restructuring plan aimed at rescuing the business, following the closure of 120 stores.

    “Like many other apparel and retail companies, BCBG has fallen victim in recent years to adverse macro-trends, including a general shift away from brick-and-mortar to online retail channels, a shift in consumer demographics away from branded apparel,” said chief restructuring officer Holly Felder Etlin in papers filed with the Federal Court in Manhattan.

    As reported in January, the fashion label is crippled with a debt said to be as high as US$665 million. More recent reports say the “secured debt” is worth about $485 million. But its total sales last year were just $600 million. The restructuring plan is dependent on a $45 million loan which must be approved by the court.

    The company had embarked on a restructure which would involve slashing its US store network and refocusing on e-commerce and wholesale sales. The company has flagship stores in Tokyo and Hong Kong, but it is the wholesale division which supplies stores bearing the brand’s name in other Asian cities, including Ho Chi Minh City. Retail accounts for 71 per cent of its turnover.

    One of BCBG Max Azria’s advisors told landlords in February that its retail sales had declined 20 per cent during the past three years – a major change of fortune for a company which in 2013 was mulling an offer valued at $1 billion.

    Under January’s restructure plan, the company was looking at closing 120 of its 200 US stores – but now reports suggest almost all of them will be closed under bankruptcy protection. The company also has mounting debt to landlords in unpaid rent.

    BCBG Max Azria Group was founded by Tunian Max Azria in 1989. Educated in France before developing a passion for fashion, he was later based in California where he drove the BCBG Max Azria brand, but he is no longer associated with the company. His brother Serge founded women’s fashion labels Joie, Current/Elliott and Equipment.

    Dresses from BCBG Max Azria have been photographed firmly fitting celebrities including Selena Gomez and Drew Barrymore.

    BCBG is an acronym for the French phrase “bon chic, bon genre” or “good style, good attitude”.

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  • Arcadia Malaysia partner rules out expansion

    Arcadia Malaysia partner rules out expansion

    Wing Tai, the corporate retailer which partners with Uniqlo and a raft of other brands, including the Arcadia Malaysia stores, says it is streamlining its retail business.

    The listed company has 85 retail stores in Malaysia’s major cities under 12 international brands – Topshop, Topman, Dorothy Perkins, Miss Selfridge, Warehouse, Karen Millen, Pumpkin Patch, Wallies, BCBG, Ben Sherman, Burton and Furla. It also has a 45 per cent stake in the joint venture with Japan’s Fast Retailing, operating 25 Uniqlo stores.

    Wing Tai GM of finance Lee Kong Beng says while the Uniqlo store network, targeting the value driven fast fashion customers, will expand into suburban markets, the Arcadia brands like Topshop and Topman have reached their limits in Malaysia.

    “We will not expand (the Arcadia brands),” he told a press briefing this week.

    He said while there were no current plans to close Arcadia stores, if any store failed to generate positive cashflow or profit it would be cut.

    “For retail, we’d just consolidate because it’s challenging. So no point being a hero, where you open outlets and the sale is not there.”

    Lee said the company was finding the current retail market in Malaysia challenging following the introduction of GST on April 1, which consumers are slowly adjusting to.

    An influx of tourists was bolstering the group’s earnings, with spending holding up in stores in high profile shopping malls.

    “We expect retail sales to pick up because of the weakening of the ringgit, so it’s cheaper to shop in Malaysia rather than in Singapore. It’s a matter of time people get used to GST. We see that (retail sales) are more stabilised now,” Lee said.

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