Joe’s Jeans Inc. is adjusting distribution of its Else subbrand to life after Macy’s, and moving more of Hudson’s production to Mexico.
On a conference call Wednesday to discuss first-quarter financial results, which surpassed expectations, Marc Crossman, chief executive officer, told analysts that the company was no longer shipping the Else brand to Macy’s stores, their sole point of sale when it was conceived two years ago as a lower-priced alternative to Joe’s premium offerings.
Else is being tested with Dillard’s and Von Maur stores in the U.S. and soon will begin shipping to an unidentified Canadian chain and be sold through a European distributor.
“We continue to believe that the brand has a place in the market, both domestically and internationally,” Crossman said.
However, in the first quarter, its sales fell 98 percent from the prior year. At its peak, Else was carried in more than 300 Macy’s stores.
In the three months ended Feb. 28, Joe’s registered a net loss of $2.2 million, or 3 cents a diluted share, lower than the $6.4 million, or 10 cents, loss incurred in the first quarter of 2013. Eliminating special charges, mostly associated with its September acquisition of Hudson, it would have reported net earnings per share of zero cents, above the 4-cent loss expected, on average, by analysts.
Revenues rose 60.9 percent to $47.3 million from $29.4 million. Eliminating $18.3 million in revenues from Hudson, sales were $29 million, 1.3 percent below the year-ago mark. Wholesale revenues were up 71.6 percent to $39.6 million from $23.1 million, but down 3.3 percent to $22.3 million when Hudson revenues are excluded.
Retail sales rose 21.9 percent to $7.7 million from $6.3 million as the addition of four stores to its fleet, which now numbers 34, and Hudson e-commerce revenues helped offset a 4 percent decline in same-store sales.
Crossman said that the company’s stores were able to compensate for lower traffic to some degree with higher conversion rates and average unit retail prices.
“Traffic in general has been down 10 to 12 percent, in that range,” he said on the call. “That’s not something that’s specific to us; that’s what we’re hearing from the malls and when we get our traffic data.”
He said the declines in traffic were fairly uniform, with outlet stores, which constitute the majority of Joe’s units, hit with declines similar to those of full-price stores.
He noted that Joe’s currently has no plans for additional stores in the U.S. and is focusing on its investments in Hudson. “Right now, we’re cautious [about retail].…We’re not seeing a big change in traffic patterns relative to rent rates.”
Joe’s continues to work toward placing more Hudson production in the Joe’s manufacturing facility in Mexico. “Make no mistake,” the ceo said. “There’s a huge opportunity here to dramatically reduce the cost per garment on the Hudson side of the business, and that remains something we’re fully committed to and more than excited about because that’s where we’ll get the real cost savings.”
He said the shift in sourcing should be evident by the third quarter.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye