NEW YORK — Ann Inc. has a healthy outlook for 2012 with midsingle comp-store sales gains and widening gross margins in the forecast.
“We’re focused on maximizing Ann Taylor and Loft and dipping our toes into international,” Kay Krill, Ann Inc.’s president and chief executive officer, told WWD on Friday after the retailer reported a solid 2011 performance that would have been stronger except the Ann Taylor stores channel dragged down the fourth quarter.
Net income for the year ended Jan. 28 rose 18 percent to $86.6 million, or $1.66 a share, from $73.4 million, or $1.26 a share, in 2010. Comparable sales rose 6.8 percent, with total sales rising to $2.21 billion from $1.98 billion.
However, fourth-quarter net dropped 72.6 percent to $2.18 million, from $7.97 million in the year-ago period, due to markdowns and some inventory issues at Ann Taylor stores and charges related to the management change at the division. Ann Inc.’s total sales for the quarter rose to $566.7 million, versus $515.3 million in the fiscal 2010 quarter. Comparable sales rose 5.3 percent.
Despite the steep fall in profits, Ann’s stock rose 6.2 percent, or $1.60, to $27.41, on the New York Stock Exchange Friday.
Krill cited several tactics geared to lift Ann Taylor, though the repair process began last month when Brian Lynch, former head of the outlets at both Ann Taylor and Loft, became Ann Taylor brand president, succeeding Christine Beauchamp.
“We will be offering more opening price points,” Krill said. “In the fall and holiday, we overskewed to best and better. In pants, for example, we got over $100. The sweet spot is $88 and $98.” She also sees a strengthening of opening price points on blouses, at $68; sweaters, $58, and dresses $98. Inventories at Ann Taylor stores — down 19 percent in February and into March — will be at “more appropriate” levels by May, she added.
The company is also advancing its “new concept” format for Ann Taylor, with 15 store openings this year, and 25 existing units getting remodeled to the format. At the end of 2011, 44 locations were under the new format, so there’s about a third of the Ann Taylor chain that’s been modernized. The concept features improved layouts, lighting and display. “It’s a home run,” Krill said, with productivity ahead “more than 50 percent.”
In a conference call, Krill discussed spring, citing strength across all channels of business, except Ann Taylor stores, “but the gross margin rate is significantly above Q4,” she noted.
She also said the company is going international for the first time by launching shipping to 90 countries around the end of the summer, and entering Canada in late 2012 or early 2013 with Ann Taylor and Loft stores. Krill declined to specify the upcoming store count in Canada, pending the signing of leases.
Loft, across all of its channels, is strong, and has recently been propelled by “a compelling mix of feminine basics and fashion,” particularly colored cords and denims, and the lounge collection. “Sweaters was the only category that was soft, impacted by warm weather, but has turned the corner and is performing very well spring to date,” Krill said. “We’re not changing the pricing at all at Loft,” Krill said. “Seventy percent is under $50. We’re not messing with that.”
Loft will add 25 stores this year. “It is clear that Loft is a brand that works everywhere,” Krill said.
But that’s not the case at Ann Taylor. “Our focus is very clear — to drive increased sales, productivity and profitability across Ann Taylor stores,” Krill said, though she also said that Ann Taylor’s online and outlet channels are performing well.
Looking ahead, the company expects total sales in the first quarter of 2012 to reach $560 million, reflecting a comparable sales gain in the low-single digits, and a 56.5 percent gross margin rate versus 48.9 percent last quarter. For the year, Ann Inc. expects total sales of $2.38 billion, reflecting a midsingle-digit comp gain, and a 55 percent gross margin rate, up from 54.6 percent last year.
@fearofgod and @maxfieldla have teamed up on a pop-up installation. The store, located in the gallery space across from Maxfield’s Melrose Ave location, is the site of the brand’s House of God pop-up in which Fear of God founder @jerrylorenzo has created a church-inspired installation. A dozen vintage church pews sit in front of an LED screen playing 90s gospel singers in an effort to re-create an environment akin to a Southern Baptist Church, Lorenzo explained. Read more about the pop-up on WWD.com #wwdfashion (📷: Jennifer Johnson)
Known for his sleek, sophisticated American glamour, Norman Norell is the subject of an upcoming exhibition at @fitnyc. “Norell: Dean of American Fashion,” which runs from February 9 through April 14, will feature approximately 100 ensembles and accessories. His best work is exemplified by the designer’s glittering “mermaid” gowns frosted with thousands of hand-sewn sequins – like the one pictured. (📷: William Helburn) #wwdfashion
For pre-fall 2018, @balmain didn’t let go of the glitz. A crystal embroidered baseball jacket priced at around $40,000 hangs in the “couture” section of the brand’s first men’s pre-collection. Sporting the words “Balmain Army” across the back, the item took around two months to make. “When it was completed, it was like Christmas, it was like, ‘It’s done, it’s exactly what I wanted,’” said Balmain’s creative director @olivier_rousteing during a tour of the collection in a Paris showroom on Monday. #wwdfashion
Eighty degree temperatures and outdoor installations at the annual Art Basel Miami Beach called for bright, elevated beachwear. See more street style pictures on WWD.com. #theyarewearing #ABMB (📷: @lifeinreverie)
Following September’s emotional tribute to her brother Gianni, Donatella Versace wanted to bring the spring show’s deep sense of intimacy to her @versace_official pre-fall collection. Donatella found inspiration in Versace Palazzo in Milan and from Gianni’s opulent apartment. Archival patterns and new motifs were splashed on silk shirtdresses and fitted jersey frocks. See the rest of the photos on WWD.com. #wwdfashion
Demna Gvasalia continues to shake up the Paris fashion calendar — and experiment with new runway timetables for his @vetements_official brand. WWD has learned that Vetements plans to stage its next coed show for the fall 2018 season on January 19 during Men’s Fashion Week in the French capital. Details about the timing and venue have not been confirmed — stay tuned on WWD.com to catch the latest. #wwdnews (📷: @giovanni_giannoni_photo)
@zacposen's go-to holiday gift? Cookies! "I'll usually bake cookies and send them as a gift," said the designer, who recently released his cookbook "Cooking With Zac: Recipes from Rustic to Refined." Get the recipe for his Brown Butter-Chocolate Chip Cookies via link in bio 🍪🍪🍪 #wwdeye #cookingwithzac
For @monsemaison’s pre-fall 2018 collection, Fernando Garcia and Laura Kim honed in on the brand’s many signatures — men’s wear, which was tweaked and feminized through deconstruction, proportion play and lots of bare shoulders. See the rest of the photos on WWD.com #wwdfashion (📷: George Chinese)
On Friday night, @yohjiyamamotoofficial received the Design for Asia Lifetime Achievement Award in Hong Kong. The 75-year-old designer has been celebrated for many years and is best known for his dark and avant-garde tailoring. “In my long career, in design, architecture, [I’ve been to] so many parties, this is the very first time that I have such a warm feeling, I really appreciate this,” Yamamoto said. #wwdfashion (📷: @dominiquemaitre)