By and  on March 4, 2005

MILAN — Gabriella Forte is stepping down as president of Dolce & Gabbana USA, marking a significant power shift at the Italian fashion house.

The company issued a brief release Thursday stating that Forte has chosen not to renew her contract for personal reasons and that she will stay at the company as long as necessary to guarantee a smooth transition.

The statement thanked Forte for her professionalism and “commitment, which have helped to increase the positioning of the Dolce & Gabbana brands in such an important market, and we wish her all success in her important market, and we wish her all success in her upcoming ventures.”

Forte was not available for comment. A Dolce & Gabbana spokesman said she is on a weeklong vacation and can’t be reached.

Meanwhile, other management changes at Dolce & Gabbana look likely. As reported, former Gucci brand chief executive officer Giacomo Santucci is expected to take a high-level post at the house. It is still unclear whether he will report to Cristiana Ruella, director of general affairs, or answer directly to the designers, Domenico Dolce and Stefano Gabbana.

Clearly, Dolce & Gabbana has seen some significant growth over the years. The most recent data from the house estimates that earnings before interest and taxes for the 12 months ending March 31 will grow 9.2 percent to 99.8 million euros, or $130.9 million at current exchange, and consolidated revenue will advance 19.6 percent to 700 million euros, or $918.4 million.

Such growth could be what’s prompting the group to consider reinforcing management and bringing in Santucci. Dolce & Gabbana declined to comment on that issue and Santucci did not return phone calls seeking comment.

Sources gave conflicting accounts of how the hierarchy at Dolce & Gabbana could morph with a Santucci entry. “There’s an issue about who reports to whom,” said one source close to Santucci. While a source insisted that Santucci would have a role “in a commercial capacity” and report to Ruella, another source close to the former Gucci manager insisted that Santucci wouldn’t accept anything less than a ceo position, thus above Ruella.

As for Forte, Ruella stressed in a phone interview that the parting is an amicable one. She characterized Forte’s tenure at the helm of the U.S. business as “an extraordinary three years” of accomplishments, such as building a corporate structure for the American business and expanding the U.S. distribution of diffusion line D&G.“Over these last three years, together with Gabriella Forte, we have experienced something extremely special,” Ruella said, adding the company and Forte together will help determine who should take over the U.S. arm of the business.

Ruella noted that the considerable growth and evolution of the company since Forte joined in 2002 may require an executive with a different “profile” than that of the departing U.S. president.  Ruella was unable to give a timetable for when a decision will be made, saying only that “it’s one of our priorities.”

Ruella strongly denied speculation that there were strategic differences between Forte and designers Dolce and Gabbana. One source close to Dolce said the designers questioned Forte’s focus on commercial clothes rather than on the entire collection.

Ruella dismissed this theory, saying that Forte and the designers share the same strategic outlook and “have always been extremely harmonious” on the methodology of growing the business.

Sales in the U.S. made up about 12 percent of Dolce & Gabbana’s wholesale revenue for the year ended March 31, 2004, as published in the company’s most recent annual report.

Prior to joining Dolce & Gabbana, the Italian-born Forte spent five years as the president and chief operating officer of Calvin Klein Inc., aggressively expanding Klein’s business into Europe via a series of joint ventures and partnerships. Before that, she spent 15 years at Giorgio Armani. As executive vice president, she headed the U.S. operations and served as Armani’s right-hand woman. Her strong management style and drive propelled Armani into new product categories and new geographical regions. Forte sent shockwaves through the industry when she left Armani for Klein. Her arrival at Dolce & Gabbana was interpreted as a major development for an emerging brand.

“Our company is deeply Italian — who better than an Italian could speak for us and convey the nature of our label? At the same time, she has a thorough knowledge of the American market and is very capable,” Gabbana said of Forte’s arrival in 2002.

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