The July acquisition of German underwear maker Schiesser AG made an immediate contribution to Delta Galil Industries Ltd.’s sales, earnings and margins in the third quarter.
“This is Schiesser’s first quarter as part of the company, but it’s a very promising start,” Isaac Dabah, chief executive officer of the Tel Aviv-based maker of innerwear, hosiery and performance knitwear, told WWD following disclosure of the results. “It was a great fit for us strategically and it’s a consistent company with excellent shelf space. It was very profitable and there’s every reason to think it will continue to be so.”
In the three months ended Sept. 30, the firm registered net income of $20.2 million, or 82 cents a diluted share, more than two-and-a-half times the $7.7 million, or 32 cents, registered during the prior-year quarter. Excluding nonrecurring items that lifted profits, the most recent quarter’s net income was $10 million, or 41 cents.
Advancing for the 12th consecutive quarter, sales rose 26.6 percent to $234 million from $184.8 million. Excluding the $48.4 million contribution of Schiesser, revenues were up 0.4 percent to $185.6 million. Gross margin leaped to 24.3 percent of sales from 20.1 percent in the third quarter of 2011.
Dabah credited Schiesser with adding “new markets, including Europe, while delivering a higher EBIT [earnings before interest and taxes] margin. With a strong and diversified portfolio of four business segments, we are also increasing our business with a wide range of existing customers and are adding new customers.”
With EBIT of $6.2 million, Schiesser’s EBIT margin — operating profit as a percentage of sales — was 12.9 percent, higher than Delta USA (4 percent), Global Upper Market (7.3 percent) or Delta Israel (2.3 percent). With Schiesser, Europe’s share of corporate sales rose to 35 percent from 24 percent a year ago.
He said the company was in the midst of evaluating opportunities for integration with its new subsidiary, including, as an example, using the Schiesser sales force to bring more DG products to European customers. “A lot of what we’re discussing will come to fruition next year, although we’ve already addressed some of Schiesser’s MIS needs,” Dabah pointed out.
Profitability was pressured by the company’s decision to consolidate production from two of its Israeli plants into one as it moves more manufacturing to lower-wage countries in and out of the Middle East.
While reiterating its full-year guidance for 2012, the firm issued its first projections for 2013 results, including revenues of $910 million to $920 million, approximately 12 percent above 2012 estimates, and EBIT of between $55 million and $60 million, approximately 13 percent above the view for the current year. Directors also authorized $2.5 million for stock repurchases during the three months beginning Nov. 11.
For the nine months, net income more than doubled to $43 million, or $1.75 a diluted share, as sales increased 13.7 percent to $571.2 million.
“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