WACHNER TALKS SWIM, MUM ON BANKRUPTCY
Byline: Georgia Lee
MIAMI — Warnaco Group chief executive officer Linda Wachner reassured attendees at the Cruise 2002 Swimwear Show here that the Authentic Fitness swim lines would continue with business as usual this season, despite the firm’s bankruptcy filing last month.
Wachner clearly did not want to discuss the specifics of the bankruptcy restructuring plans or possible sell-offs of any of Warnaco’s divisions. Asked if any of the group’s labels would be sold, she replied: “We have not announced plans for selling any brands.”
Calling Authentic Fitness and Speedo “powerful brands,” she said the cruise 2002 lines were innovative in design, and said Speedo, in particular, had “more new bodies, print interest and new textures.” She added that inventories were “clean and good,” and that she did not anticipate further staff reductions or store closings. Speedo and Authentic Fitness have 115 retail locations nationally.
Swimwear lines under the Authentic Fitness banner include: Anne Cole, Cole of California, Hot Coles, Oscar de la Renta, Catalina and several Ralph Lauren labels.
With the exception of Chris Staff, the former president and cfo of Authentic Fitness who in June took the same title at Wet Seal, Wachner said her management and design team would remain the same.
Speculation about the sale of various Warnaco assets was active even before the company filed Chapter 11 on June 11. With more than 1,000 creditors and liabilities of $3.1 billion as of April 7, the divestiture of at least certain key properties has been viewed as inevitable by the investment community since the New York-based firm reported a $194.8 million loss back in March. Tony Alvarez, founding managing director of the turnaround firm Alvarez & Marsal, joined the company as chief restructuring officer just prior to the filing.
Since his addition, reports emanating from various credit and investment sources have suggested that the company could be totally broken up or that only a portion of its principal businesses — which include jeanswear, intimate apparel and activewear — might be retained. Like Wachner, Alvarez has declined to comment on these reports.
Meanwhile, sources said that Wachner is still in the thick of things, handling all marketing aspects of the company while Alvarez focuses on the administrative and financial end of the business. Some sources indicated it could take as long as six months for any assets to be sold.
Wachner said that swimwear shopping would be “better this season, because we’re getting orders earlier and getting meaningful orders from retailers.” She acknowledged continuing softness at retail but said that recent good weather had boosted summer swimwear business.
“In general, retailers have indicated they’re not expecting a great second half this year,” she said. “We think it will take until the end of the first quarter of 2002 for things to really improve.”
Wachner gamely appeared often in the booth during her day-and-a-half stay here, and met with retailers including Macy’s, Lord & Taylor and Bloomingdale’s, she said. Dressed Sunday in a beige pantsuit with a pink sweater draped over her shoulders, she smiled often and said she “loved working the show and meeting with everyone here.”
The show opened Saturday and runs through Wednesday at the Miami International Merchandise Mart and Radisson Centre. Wachner returned to New York Sunday night.
Asked how she was doing personally, she responded: “I’m fine. Our lines are being well received, our product is newer, in bodies and prints, and there’s a positive buzz here. Everyone has been very supportive.”
Attendees at the show, including retailers, expressed concerns over the possible sell-off of divisions that might affect swimwear deliveries. Most said they were pulling for Warnaco to pull through.
“Business has been tough this year,” said Tristene Berry, merchandise manager of intimate apparel and swimwear for BASF Corp., “and we need everybody to be healthy.”