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.”
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)