NEW YORK — Enthusiasm for Kate Spade is trumping troubles at Juicy Couture for Fifth & Pacific Cos. Inc.
Shares of Fifth & Pacific shot up 11.2 percent to $11.40 Thursday even as the company said it cut 20 percent of the Juicy corporate workforce and that another year of merchandise tweaks was in the offing.
Kate Spade is clearly the standout performer at the company.
The division’s adjusted operating profits rose to $9 million from $5 million in the third quarter as sales jumped 35.1 percent to $102 million. The brand also continues to open stores, and is buying back its Japanese business and branching out with Kate Spade Saturday, a less expensive, more causal line with global prospects.
Investors analysts have pushed Fifth & Pacific to spin off the Kate Spade business before, but William L. McComb, chief executive officer, held his ground. Now the ceo seems ready to at least let Wall Street take a closer look at the business and is contemplating an investor day for the brand in the first half of next year.
Corinna Freedman, an analyst at Wedbush Securities Inc., said Kate Spade is quirky, digitally savvy and simply clicking with a certain shopper.
“[The Kate Spade customer] is not as trendy as the Michael Kors customer, but maybe she’s not as bohemian as the Anthropologie customer,” Freedman said, noting the product was “refined.”
The comparison with Kors is made frequently. And some are looking bigger still.
“We think Kate Spade is the next Coach,” said Mary Ross Gilbert, managing director at Imperial Capital. “Kate Spade we think is relevant across more categories than Coach. They have a small, but fast-growing apparel presence. We think it could be in the multibillion-dollar range.”
Gilbert said it was possible that the company would spin off part of Kate Spade next year, creating a tracking stock that would “properly value the business.”
Overall, Fifth & Pacific Cos. Inc. showed improvement in the third quarter. Net losses narrowed to $18.8 million, or 17 cents a share, from $214.6 million, or $2.27, a year ago.
Adjusted losses of 5 cents a share were 2 cents better than the 7 cent loss analysts projected. The company warned last month that Juicy wasn’t performing as strongly as expected.
Sales for the three months ended Sept. 29 fell 4.2 percent to $364.6 million from $380.7 million. The company, which used to be known as Liz Claiborne Inc., is at the tail end of a period which saw it sell off its namesake brand and numerous other assets to pay down debt and focus on Juicy, Kate Spade and the Lucky Brand.
Juicy posted an adjusted operating loss of $5 million in the third quarter as sales fell 5.5 percent to $130 million. Comparable-store sales were flat.
George Carrara, who was named executive vice president, chief financial officer and chief operating officer in May, has been spending much of his time working on rejiggering the brand’s business.
Juicy stores were reset in August, but full-price sell-throughs fell. The first two fall deliveries were too heavy for the warmer weather and the company was unwilling to let inventory build. The brand is now working to lower its pricing and, beginning for next fall, refocusing on dresses, knit tops and denim as the key fashion categories.
“The brand has real chops with consumers and has an enviable international position,” said McComb. “We’re moving forward there and I’m confident about the path ahead.”
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast