By  on March 9, 1994

NEW YORK -- Women's sportswear had its share of troubles last year, but according to Wall Street, the worst may be over.

Analysts are predicting a modest recovery this year, thanks to cost controls, leaner inventories and stronger fashion direction.

Last year's financial results for apparel manufacturers show women's sportswear -- along with fleecewear and T-shirts -- was a troubled business.

Some sportswear makers -- notably Jones Apparel Group and St. John Knits, among a handlful of others -- pulled solidly ahead, but the sagging performance at Liz Claiborne Inc. was a dim bellwether for the category.

Overall, a compilation of 26 women's and men's apparel companies showed a healthy gain of 44.2 percent in profits on a 5.7 percent gain in sales for 1993. But the results were skewed by turnaround situations, a number of major special charges, and exceptionally large gains among men's wear companies, buoyed in some cases by the strong acceptance of wrinkle-free cotton pants.

The year ended on a bumpier note, though, with an 11.7 percent drop in fourth-quarter profits on a 3.7 percent sales gain.

Two companies absent from the 1993 compilation are the Gitano Group and Crystal Brands, whose deep financial problems would have further distorted total figures had they been included. Crystal Brands filed a Chapter 11 petition here on Jan. 21, and Gitano put itself on the block, struck a deal last month with Fruit of the Loom and entered Chapter 11 to push the sale through.

For the current year, apparel sales got off to a slow start, hampered by severe weather and the Los Angeles earthquake, but analysts say recovery should be visible by the second half. Todd D. Slater of UBS Securities forecast "growth in career areas because casual clothing is crowded."

"The consumer will buy things she needs unless there is something exciting to generate her interest," Slater said.

"Nobody can really put their finger on the malaise of women's sportswear," said Laurence C. Leeds Jr., a managing director at Buckingham Research.

Leeds, the former head of Manhattan Industries, added: "Some say it is a fashion inadequacy, but no one seems to have any brilliant ideas on how to rectify the situation." Although Leeds doesn't predict any "macro trends" this year, he noted that last year's winners -- including Jones Apparel Group and Kellwood Co. -- should continue to gain market share, while Liz Claiborne is expected to continue trying to deal with a sluggish sportswear market.

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