GAP VETERAN DEROSA TO BECOME PRESIDENT OF ANN TAYLOR DEC. 9
Byline: David Moin
NEW YORK — Patricia DeRosa, a veteran of Gap and a builder of new businesses, will become president and chief operating officer of Ann Taylor Stores Corp. on Dec. 9.
Since August 1995, she has been executive vice president of Charming Shoppes, where she launched the International Exchange division for moderate men’s, women’s and children’s apparel. Currently, Exchange has just one store, a 13,900-square-foot unit located north of Trenton, N.J. It’s considered a test for future stores and has been compared to Gap’s Old Navy concept.
Before that, DeRosa had a long run at Gap. “She was one of Mickey’s kids,” said a source, referring to the team under Millard Drexler, Gap’s chief executive officer and top merchant, who is largely credited for Gap’s phenomenal success in wardrobing America in casual clothes and adeptly reinventing itself over the last two decades.
DeRosa joined Gap in 1975 as a sales associate and rose through the ranks as a merchant. Among her top jobs, she was senior vice president of men’s for the Gap division from 1989 to 1991, Gap division executive vice president (the top slot at the time) from 1991 to 1993 and president of GapKids from 1993 to 1995, where she was charged with expanding the business from 275 to 350 stores. She was also instrumental in launching Gap shoes and Old Navy.
Announcing DeRosa’s appointment, Ann Taylor chairman and ceo J. Patrick Spainhour said in a statement Monday, “From her long and successful experience at the Gap and GapKids, Patti understands how to build a brand and how to manage a vertically integrated design, merchandising and sourcing organization.” DeRosa reports to Spainhour, who oversees finance and operations.
At Ann Taylor, she succeeds Sally Frame Kasaks, who was ousted last summer, some think prematurely. Ironically, since her departure, Ann Taylor has performed well, and some of her remerchandising efforts paid off in the third quarter. In fact, the chain reported some of the strongest comparable-store sales of any major retailer in the period. For the quarter, Ann Taylor posted earnings per share of 21 cents, up from 3 cents in last year’s quarter. Sales rose 19 percent to $213 million. Same-store sales were up 12.6 percent, coming off an 11.3 percent drop the year before.
However, sources cited Ann Taylor’s roller-coaster performance over the longer term and the steady exodus of top executives from Kasaks’ team.
Market experts say Ann Taylor’s merchandise quality this fall is improved and there’s more of what the traditional Ann Taylor shopper wants to buy, in casual and career wear, outfits and basics that tend to be all a little different from other store offerings.
The chain has been under pressure to find a new president quickly because of the need to get started developing the fall 1997 assortments and bolster the stock price. Ann Taylor stock closed Monday at 21 1/8, up 1/2 on the New York Stock Exchange. The stock has traded as high as 24 1/4 and as low as 9 1/4 in the past 12 months.
Reportedly, about 70 names were drawn up early in the search, which lasted 2 1/2 months and was conducted by Hal Reiter, president of Herbert Mines Associates.
While many on Wall Street approved of DeRosa’s appointment, announced Monday, it still came as somewhat of a surprise. Her experience at Gap and Charming kept her relatively low-profile, working under the shadow of Drexler at Gap and Dorritt Bern, the Charming ceo. More often, it was the marquee names in retailing that were rumored to be candidates for the Ann Taylor post, among them Jeane Jackson, Banana Republic president, though Gap is known for keeping a tight grip on its executives.
“DeRosa was not on the original rumor list of expectations, but more recently her name was bandied about,” said Maura Hunter Byrne, J.P. Morgan Securities, retail analyst. “It probably had to do with the fact that Mr. Spainhour was the Gap’s senior vice president of sourcing from 1988 to 1993.” Spainhour and DeRosa worked together at Gap for five years.
Byrne said DeRosa has “an interesting background to keep Ann Taylor on track. She needs to add some bench strength to the merchandising team. They’ve lost some people over the past couple of years and primarily promoted from within. Her first order of business would be to assess the breadth and depth of the merchandise team.”
“She may have some different ideas on how to run the business, but Ann Taylor still is a very strong brand,” added Thomas Filandro, senior vice president, retail analyst, Gerard Klauer Mattison & Co. “It still commands very high loyalty. I think the real key is to maintain strict controls on quality and intensifying less-structured and more casual assortments.”
DeRosa said in a statement that the 311-unit Ann Taylor “can build on its successes and be even more successful in the future.”