MAIDENFORM’S NEW FOUNDATION
Byline: Karyn Monget
NEW YORK — Backed by new management, financial support and expanded product assortments, Maidenform Inc. is looking to reclaim its share of the bra market.
After emerging from bankruptcy protection in July 1999, the venerable, 79-year-old bra specialist has weathered the ups and downs of a sour economy and weak retail climate and is slowly reshaping its presence as one of the top-selling brands at department stores.
Thomas J. Ward, who was named Maidenform’s president and chief executive officer in August 2001, said: “The company has had a lot of problems throughout the years, but we’ve had enough business to keep us healthy, as well as new financing from Congress Financial that stabilized the company.
“We are very pleased with the direction the company is taking. We are able to ship on time and we feel very comfortable with our new products. There was a much different mood at the March market than in previous markets, there was an optimistic mood, and we had a very strong market.”
Ward was a 32-year veteran of WestPoint Stevens Inc., where his posts included president and chief operating officer. In December, Maidenform named Kevin Walsh, another executive whose expertise was gleaned outside of the intimates industry, as executive vice president and chief financial officer, responsible for finance, treasury and information technology. Walsh’s resume includes executive posts at Johnson & Johnson and Burger King.
Regarding his view of the intimate apparel field, Ward observed: “I knew this company was different operationally when I joined it and I knew it had great brands. But I didn’t understand the recognition the Flexees and Lilyette brands had.”
Ward added that Maidenform is in the process of reviewing other licensees such as robes. He said: “What we really want to get is brand awareness and equity.”
Maidenform has licensees for girls’ daywear and underwear at Delta USA, slippers at Weisner and, most recently, a sleepwear license with Clubhouse Collections Inc., which received positive reaction from retailers when it was unveiled this month, Ward noted.
Congress Financial, a unit of First Union Bank, provided an $82.5 million cash infusion and a $60 million revolving credit line in May 2001 secured by receivables and inventory, as reported. Additionally, a $7.5 million [two-year] term loan by Congress Financial was secured by certain real estate assets. At the time, two major shareholders, GE Capital and Oaktree Capital, had agreed to make a $15 million cash investment in the company. This led to net sales in 2000 of $245 million. This year, the company’s volume is expected to reach $250 million, Ward said.
Wholesale revenues of the Maidenform brand, excluding the Flexees shapewear and Lilyette full-figure bra business, are planned to be flat with 2001 at $150 million. Ward would not update the company’s debt load, but it was $50 million last year.
Maurice Reznik, president of the Maidenform brand, said the company is projecting a 30 percent increase for total Maidenform business the first half of 2002.
“It’s all based on new product and shipping on a timelier basis,” said Reznik, noting that deliveries averaged 90 percent in February compared with 70 percent during the same time frame a year ago.
The newest Maidenform bra to hit stores is the One Fabulous Fit bra, a wafer-thin, stretch-foam style overlaid in ultrasoft nylon and Lycra spandex microfiber.
“We continue to have close to 50 percent market share in our Flexees [shapers] business, but what was lagging behind was our Maidenform [bra] business,” Reznik said. “One Fabulous Fit was introduced in January and it’s been performing very well.”
Manette Scheininger, senior vice president of marketing and merchandising, said two new styles in the three-year-old Customize It group of bras received good reaction from buyers. They are a Deep Plunge Push-Up style of microfiber with soft-foam cups trimmed with cross-dyed multicolor embroidery, and an Uplift Contour soft-cup number, which also features convertible straps. Colors include black, white, ivory, plum, rose, nude and forest green.