Pay Cut for VF Bigs
A tough year shrank bonuses for the top executives at VF Corp.
Mackey J. McDonald, chairman, president and chief executive, saw his compensation drop to $1.56 million from $2.82 million, primarily stemming from a reduction in bonus to $555,000 from $1.5 million, according to VF’s recently released proxy statement.
McDonald did not receive any restricted stock awards because performance objectives weren’t reached in 1999, according to a report by VF’s compensation committee. Last year, he was rewarded $432,000 in restricted stock. As reported, profits at the Greensboro, N.C., firm fell 5.7 percent last year to $366.2 million, or $3.04 a share.
The committee noted that the $555,000 annual bonus was awarded because under McDonald’s leadership, VF’s “sales reached an all-time high, margins were at healthy levels and VF continued to maintain its strong financial position.”
The committee also noted that the company acquired four workwear firms, made “significant progress” in upgrading technology and “successfully navigated through several difficult operational and marketing issues.”
McDonald also received options to buy 150,000 shares at $43.20 each. Shares of VF closed at 24 15/16, up 5/16, on the New York Stock Exchange on Wednesday.
Among other executives, John P. Schamberger, vice president and chairman of North & South America jeanswear and workwear coalitions, earned $764,000 versus $1.58 million, and Daniel G. MacFarlan, vice president and chairman of knitwear, playwear and intimate apparel coalitions, $790,000 against $1.34 million.
Timothy A. Lambeth, vice president of global processes since March 1999, earned $790,000 against $1.34 million. He was previously vice president of European and Asian operations. Terry L. Lay, corporate vice chairman and chairman of the international coalition since March 1999, earned $631,000. Lay was formerly president of Lee.
VF’s annual meeting will be held April 25 at the Grandover Resort & Conference Center in Greensboro.
Like a Rolling Stone
Tommy Hilfiger’s enthusiasm for the Rolling Stones and everything to do with them knows no bounds.
The designer has signed Elizabeth Jagger, the 16-year-old daughter of Stones frontman Mick Jagger, to appear in Tommy Jeans’ fall ad campaign, according to a spokeswoman.
The young Jagger is a high school student and lives in London. Out of concern for her privacy, her parents are releasing neither biographical information nor a photo. This apparently does not include her picture being plastered over fall fashion magazines.
The spokeswoman said that the company is still determining how Jagger’s image will be used in its fall campaign, to break in August.
Last year, Tommy Hilfiger sponsored the Rolling Stones’ “No Security” tour.
“We are in no way contemplating a liquidation or shutting our doors,” said Daniel Rubin, ceo of Chic by HIS, in response to rumors of an impending liquidation. Rubin also declined to comment on reports that VF Corp. was about to buy the New-York based seller of jeans to the mass market.
Rubin said he would be able to comment more on Chic’s situation in a few weeks. Under new management led by Rubin, Chic has received a major overhaul, including the launch of a $9 million television and print campaign last year, titled “I’m Beautiful,” as part of an overall effort to become less focused on production and more on fashion and marketing.
However, weakness in basic five-pocket jeans led the company in January to report a $5 million fourth-quarter loss, placing the firm in default on its domestic credit agreement with CIT Commercial Services. The company has since lost its chief financial officer and its stock closed Wednesday up .5 to .625 on the New York Stock Exchange. Its 52-week high is 3 3/8.
Some of the liquidation and acquisition rumors stem from the February hiring of Stephen Goldstein, formerly of liquidator Alco Capital Group, to help “consummate various transactions the company is pursuing and to restructure the company for future growth.” Blackstone Group was hired in November to field interest from “prospective purchasers for certain of the company’s assets.”
Sources speculate that Chic would most likely be looking to sell its plants in Tennessee to focus on newer, lower-cost plants in Mexico, but now may be entertaining bids for the entire firm.
VF is viewed as the most logical buyer, according to market sources, since the addition of the Chic women’s brand would complement VF’s dominant position with Wrangler men’s in the mass channel. VF would also expand significantly in Germany, where Chic said it believes its HIS brand was the best-selling women’s jeans brand last year.
But VF declined to comment directly on these reports. Asked on a conference call earlier this week if VF had acquired Chic, Robert K. Shearer, VF’s chief financial officer, said: “No. We’ve not and we’re aware of some rumors, and as usual we don’t respond to rumors of that nature.”
Chic’s sales slid 6.2 percent in the year ended Nov. 5 to $253.8 million, with Europe, primarily Germany, accounting for about 40 percent of sales. Chic’s sales peaked at $376.1 million in 1995. The company hopes a new emphasis on fashion denim and casual pants will lead to a rebound.
Todd Oldham: Webby Contender
Todd Oldham’s Web site has been nominated for a Webby Award, which honors creativity on the Internet.
The site, ToddOldham.com, is one of five nominees in the fashion category. Also nominated are Paul Smith’s site, PaulSmith.co.uk; FashionUK, a magazine at Fuk.co.uk; Hint Fashion Magazine, at hintmag.com, and Solemates: The Century in Shoes, a footwear retrospective at centuryinshoes.com.
Webbys are given in a total of 27 categories, also including activism, the arts, music, film and weird. The awards are presented by the International Academy of Digital Arts and Sciences, a 350-member new media organization.
Celebrity judges are to include Simpsons creator Matt Groening, musician David Bowie and designer Max Azria of BCBG.
Webby Awards founder Tiffany Shlain said in a statement that the nominees “represent the best in a medium that grows at an increasingly dizzying pace every day.”
This will be the fourth year that the Webby Awards have been given. The ceremony will take pace May 11 at San Francisco’s Nob Hill Masonic Center. According to the ceremony’s rules, winners must limit their acceptance speeches to five words.
In a Wednesday phone interview, Ross Klein, senior vice president of corporate marketing at Todd Oldham Jeans producer Sun Apparel Corp., said he was “thrilled” at the nomination.
He noted that soon after launching last summer, the site — designed by Oldham himself and RDA International — attracted a large number of international visitors, from countries including the U.K., France, Japan and the Scandinavian nations.
Klein added that the company is considering adding an e-commerce function to the site this fall. Should it do so, he explained, the expertise of sister company Nine West Corp. would be called in on inventory and fulfillment.