Most Recent Articles In Financial
Latest Financial Articles
- China Woes Dampen European Stock Markets in Midmorning Trading
- Europe’s Stock Markets Make Gains in Mid-morning Trading
- French Companies Make $47.8 Billion Climate Pledge
More Articles By
MILAN — Just as La Perla workers are expected to gather for a protest in Bologna Monday over potential job cuts, the innerwear company issued a note to the press to outline its expansion plans and assure production will remain in Italy.
This story first appeared in the October 29, 2012 issue of WWD. Subscribe Today.
La Perla said it has initiated a turnaround process in order to develop and protect its future and to improve efficiencies with the aim of staying in Italy, “which will continue to have a central role both in planning and producing collections.”
Chief executive officer Tim Brasher has told unions that the brand’s owner, private equity fund JH Partners, has earmarked yearly investments of about 4 million to 5 million euros, or $5.2 million to $6.5 million at current exchange, with the goal of relaunching the brand globally. “La Perla is and intends to continue as a symbol of Made in Italy in the world,” said the company, explaining that, since 2008, JH Partners has invested about 50 million euros, or $64.9 million, and plans to continue supporting La Perla’s expansion. San Francisco-based JH Partners acquired full control of La Perla Group in October 2008, after taking a 70 percent stake in the company in July 2007.
Last month, JH Partners told WWD it had no intention of selling either La Perla or luxury home accessories, bedding and loungewear brand Frette Srl, which it also controls. However, JH Partners added that La Perla is open to a financial partnership, “considering for La Perla the opportunity to share with a financial partner the implementation of the medium-long term strategic plan to help accelerate the growth of the business,” said officials at the fund.
The plan, “already in an advanced stage, is based on three pillars,” including the positioning of La Perla “as a global luxury brand, internally developed in Bologna,” and in partnership with Italian suppliers. Distribution will increasingly be aimed at regions where luxury is growing the most, such as Asia, Russia, Eastern Europe, Latin America and top cities in the U.S. and Europe. La Perla opened five stores globally last year, but accelerated its retail distribution in 2012 with the unveiling of 24 units. The firm plans to open 26 units in 2013. In 2012, two distribution partnerships were inked in Japan and Korea, in addition to the strengthening of an existing one in China.
The second major priority for JH Partners is to launch the diffusion Studio La Perla label trough a single-brand network of boutiques with a new concept. The first two units will open between December and January in Italy. In the next three years, the owners plan to open 160 news sales points globally for La Perla and Studio La Perla.
The third item on the agenda is that the owners are aiming at reducing operating costs and gaining efficiency in all production sites and Brasher has presented a plan to the unions to this end. In 2012, the company will continue to report operating losses but management expects the bottom line to improve next year. La Perla is expected to close 2012 with a loss of 5 million euros, or $6.5 million. Last year, revenues totaled 113.2 million euros, or $157.3 million at average exchange.
As part of the reorganization of the group, La Perla has “opened an unemployment procedure for 309 people in Bologna,” said the firm. Of this figure, 230 are already under a government-funded leave. La Perla has a total of about 600 workers.
The firm’s management has “declared its availability to cooperate with unions to find the more suitable solutions to minimize the social impact,” concluded the company. A new series of meetings with the unions will kick off Monday.