Arden, Ferretti Set Fragrance for 2009… Alberto-Culver Turns Profit

Alberta Ferretti said Monday it plans to launch a signature fragrance next year under a new long-term licensing agreement with Elizabeth Arden.

MILAN — Alberta Ferretti said Monday it plans to launch a signature fragrance next year under a new long-term licensing agreement with Elizabeth Arden.

This story first appeared in the January 29, 2008 issue of WWD.  Subscribe Today.

Plans call for the fragrance, which is still unnamed, to make its debut in spring 2009 and be followed by a line of cosmetics and skin care products.

The Italian designer said in an interview that she was “very happy” about the agreement, and praised Arden for its “well-structured, international organization that will help develop the product around the world.” Ferretti said that “quality and global distribution are fundamental,” but also underscored how the fragrance and cosmetics firm is associated with beauty and personal care.

“Elizabeth Arden evokes a feminine universe of sensuality,” said Ferretti. The designer said her future foray in cosmetics and skin care — a competitive field that has often proven to be a challenge for designer brands — was part of her being a woman and her “needs to find the right sense of color and harmony.”

The fragrance first will be launched in Europe and then in the U.S. in the fall. Ron Rolleston, executive vice president of global marketing at Elizabeth Arden, said in a phone interview that the fragrance will be positioned in a “very exclusive” range of the market and that the company plans to develop “two or three fragrances” with Ferretti.

Arden, said Rolleston, is focused on expanding its European designer fragrances portfolio. “With her beautiful, elegant gowns for glamorous women, Ferretti represents the same values Elizabeth Arden stands for — high quality for women,” said Rolleston. “Where Ferretti is placed, her consistent vision and definition of beauty are synonymous with Elizabeth Arden.”

Ferretti, who is creative director of the project, said she prefers scents that are not too “sporty” or too sweet. “I have this idea of an enveloping fragrance, one that triggers strong emotions,” said the designer. Ferretti said she wanted to fully explore the possibilities of names and bottle designs. “It’s complex because we need to say a lot with such a small object,” she said. “There are so many emotions I want to convey with the name and it must be in harmony with the bottle and the fragrance,” said Ferretti.

This is the first fragrance for the designer and her third license. Last week, Ferretti said the company will introduce a new eyewear line, licensed to Elite Group SpA, at Mido, the upcoming eyewear exhibition held in Milan in May. The other license is with Gant for the production and distribution of the children’s wear line Alberta Ferretti Girls.

“The fragrance completes the image of the label,” said Ferretti. The designer said this was a “good moment” for the brand, with a consolidated customer base and an improved organization.

Aeffe SpA, which operates the Alberta Ferretti, Moschino and Pollini brands, and produces collections for Jean Paul Gaultier, reported 2007 full-year sales of 293.2 million euros, or $401.9 million at average exchange rates for the period, a 10.2 percent increase compared with the previous year. Sales of Alberta Ferretti, the best performer of the group, leapt 19.4 percent to 63 million euros, or $86.4 million.

E. Scott Beattie, chairman and chief executive officer of Elizabeth Arden, described the designer as “an icon” in the fashion industry in a statement issued on Monday. Other designer brands under the Arden umbrella include Alfred Sung, Badgley Mischka, Bob Mackie, Gant, Geoffrey Beene, Halston and Nanette Lepore.

Massimo Ferretti, chairman of Aeffe and brother of Alberta, said in the statement that the license “guarantees the same standards of quality and excellence which are synonymous with those of our brand.
— Luisa Zargani

Alberto-Culver Turns Profit

NEW YORK — Strong sales of the TRESemmé and Nexxus hair care brands helped parent Alberto-Culver Co. swing to a profit in the first quarter.

For the period ended Dec. 31, net income came in at $30.9 million, which compares with a loss of $5.9 million last year. Sales rose 14.1 percent to $400.7 million from $351.1 million a year ago.

The TRESemmé and Nexxus brands experienced double-digit growth during the first quarter, despite a slowing economy, according to V. James Marino, president and chief executive officer of Alberto-Culver.

The company, which also markets St. Ives skin care and Alberto VO5 hair care products, earned 31 cents a diluted share — beating Wall Street analysts’ expectations by 5 cents, according to Yahoo Finance — compared with a loss of 6 cents a share in the year-ago period.

“We feel we’re positioned well [regardless of] where the economy goes,” Marino said on a conference call with analysts Monday. “Our Nexxus business doesn’t seem to be impacted, at least [to date]. If there is trading down — if people feel guilty about buying a salon brand, we offer them an alternative with TRESemmé. Our portfolio works well either way.”

Responding to an analyst who asked if Nexxus has the same sales potential as salon brands diverted into the mass market, Marino suggested that diversion might help Nexxus if the availability of salon brands in the mass market makes these stores a destination for salon brands.

Alberto-Culver’s gross profit margin increased to 52.6 percent from 51.5 percent during the first quarter of 2007 and the firm’s advertising and marketing expenditure was increased by 10.8 percent to $67.5 million with spending on VO5, Nexxus and TRESemmé.

Marino said the firm is planning a “new market launch” for TRESemmé, adding that details of the initiative would be discussed in the spring. He added that benefits of closing manufacturing plants in Dallas and Toronto would be realized later this year and that benefits of opening a plant in Jonesboro, Ark., would be realized in 2009 or 2010.
— Matthew W. Evans

Kao Net Slips 7 Percent

TOKYO — Kao Corp. reported its net profits fell 7 percent to 53.7 billion yen, or $458.6 million at average exchange, for the nine months ended Dec. 31, versus the same prior-year period, due to rising raw material prices and cost-cutting efforts.

Sales were up 7.3 percent to 1 trillion yen, or $8.54 billion, thanks in part to a solid performance from new products, the company said.

The nine-month figures reflect Kao’s full consolidation of Kanebo Cosmetics’ business, whereas the comparable figures from fiscal 2006-2007 only included eight months worth of the activities of Kanebo, which was acquired in January 2006.

Sales from Kao’s beauty care division increased 7.8 percent to 464.8 billion yen, or $3.97 billion. Within that, prestige cosmetics registered a strong turnout, as did premium hair care products, which benefited from the new line Segreta and the relaunched Asience collection, according to the company, which did not break out figures.

Kao’s John Frieda brand performed especially well in Europe, backed by the launches of new and improved products. However, the brand’s U.S. sales were sluggish, impacted negatively by intensifying competition there. In fragrance, revenues of Kao’s Molton Brown brand grew substantially, mainly in the U.K.

In Japan, Kao’s overall beauty sales increased 8.7 percent to 335 billion yen, or $2.86 billion, in the nine months. In China, the company’s business was driven by prestige cosmetics sold in department stores and high-end drugstores.