For most retailers, the arduous task of reporting second-quarter results has come and gone and, as expected, the picture they painted wasn’t pretty.
But the few last week who could lay claim to some sort of good news, or hint there was good news coming, were rewarded by investors. Their gains stood out in a week when the S&P Retail Index inched up 1.1 percent to 370.35 and the Dow Jones Industrial Average advanced 0.4 percent to 9,544.20.
Shares of Guess Inc. shot up 16 percent to $35.46 for the week as second-quarter earnings rose 10.6 percent.
“We definitely feel that conditions have stabilized in a number of ways, but that doesn’t mean the crisis is over and there is no doubt there are challenges ahead,” said Paul Marciano, chief executive officer.
At J. Crew Group Inc., a slight rise in profits helped push its stock up 10.3 percent to $34.73. Millard “Mickey” Drexler, chairman and ceo, also saw signs of improvement and said the downturn has had its benefits. “There’s nothing like a good old-fashioned recession to make you run a better business,” he said.
Chico’s FAS Inc.’s net income more than doubled on sales gains and the retailer’s stock rose 8.4 percent to $13.11. And Coldwater Creek Inc. posted a loss, but said it was ready to ramp up spending on marketing and inventory to drive sales. Investors pushed the stock up 10.3 percent last week to $7.69.
Of 172 stocks tracked by WWD, 117 were up for the week, 8 were flat and 47 were down.
Friday also brought fresh signs that the economy could be headed toward better days.
The Economic Cycle Research Institute said the four-week moving average growth rate of its Weekly Leading Index hit a 38-year high of 19.6 percent. The index had a modest dip for the week ended Aug. 21.
Lakshman Achuthan, the forecasting firm’s managing director, said the index’s continuing surge meant “a double dip back into recession in the fourth quarter is simply out of the question.”
But the next few years could still be trying ones for retailers.
Charles McMillion, president and chief economist at MBG Information Services, said the recession might be nearing an end, but that the recovery could be “weak and fragile” without additional government intervention.
The Commerce Department reported that July disposable personal income held steady from June and McMillion noted the measure fell 0.2 percent on an inflation-adjusted-per-capita basis. Personal consumption expenditures rose 0.2 percent in July.
But McMillion said the record $13.9 trillion decline in household wealth from the second quarter of 2007 through the first quarter of this year would continue to weigh on spending.
“I do not expect total…household net worth to return to constant dollar 2007 levels until 2015 or later suggesting that the sluggish growth in spending may persist for many years,” McMillion said.
“My personal philosophy to beauty is paying attention to oneself. I love to be outdoors, lots of fresh air, trying to take care of yourself as best you can. I always notice that comes through,” says Felicity Jones, the global face of @shiseido-owned @cledepeaubeauteus, which launches today. Head to WWD.com to read more about the actress’ love for beauty and how she prepared for her new role in “The Basis of Sex,” playing the young Ruth Bader Ginsburg. #wwdbeauty (📷: @dandoperalski)
For men’s fall 2018, @giuseppezanotti drew on elements from streetwear, sport, biker, combat and rock ‘n’ roll. Pictured here are a pair of shoes from the collection, featuring zippers, rhinestones, and silver hardware. Head to WWD.com to see a roundup of the accessories from Milan’s men’s fall 2018 shows. #wwdfashion (📷: Andrea Delb)
To celebrate the 25th anniversary of @ralphlauren’s snowboarding collection, the brand is mining its archives. The iconic brand is reintroducing vintage styles and dropping new designs for a color capsule that will be available in Ralph Lauren stores and @openingceremony on January 25. The capsule will consist of 10 pieces, including the Snow Beach Pullover, pictured here, which is a collector’s item that rapper Raekwon wore in Wu-Tang Clan’s “Can It Be All So Simple” video. #wwdfashion (📷: Tom Gould)
For @rochasofficial’s pre-fall 2018 collection, creative director Alessandro Dell’Acqua channeled the sophisticated and intriguing Catherine Denevue in the film “Belle de Jour.” Polished collarless coats, midi skirts, suits and ’60s graphic motifs were all featured in the collection, adding a sense of discreet luxury. See the rest of the photos on WWD.com #wwdfashion
“We tried to produce clothing of that couture quality, but the most daunting part was that we only had a matter of days [to do it],” said costume designer Lou Eyrich, who recreated Gianni Versace’s iconic looks for @americancrimestoryfx. Eyrich searched online retailers and vintage shops for original pieces from the design house and for @penelopecruzoficial, who plays Donatella Versace. Head to WWD.com to read how she created the Versace world. #wwdfashion
Only three months after her stellar debut catwalk season, @kaiagerber has inked her first big design collaboration –– with @karllagerfeld. The collection blends Lagerfeld’s Parisian chic aesthetic and the model’s signature West Coast casual style via RTW, accessories, footwear and more. The #KarlLagerfeldxKaia collection will launch in September with a series of events. Get all the details on WWD.com. #wwdnews #wwdfashion
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews