Monthly Archives: August 2012
Guess Inc slashed its full-year profit forecast as the U.S. clothing maker resorts to discounts to clear excess inventory and a weak euro hurts revenue from Europe, sending its shares plunging 17 percent in extended trade.
Morningstar Inc analyst Peter Wahlstrom said the effects of a weak euro were higher than what management had anticipated, which it now expects will weigh on results through the second half of the year.
Revenue from Europe — which contributes about 39 percent to total revenue — fell 14.5 percent to $246.9 million. In local currency terms, revenue fell 1.9 percent in the region.
Known for its namesake jeans, the company had been trying to shift away from a promotional, traffic-driven business in North America to a full price model, without much success.
“The company has been having mixed results since it is still a very promotional environment,” Wahlstrom said.
Guess, which primarily sells to shoppers aged between 18 and 32, lowered its full-year revenue forecast to between $2.62 billion and $2.65 billion, from $2.70 billion to $2.74 billion it expected earlier.
It now expects to earn between $2.15 and $2.30 per share in the period, down from the $2.50 to $2.65 per share it had forecast earlier.
Analysts on average expected the company to earn $2.59 per share on revenue of $2.71 billion, according to Thomson Reuters I/B/E/S.
Profit in the second quarter ended July 28 fell to $42.9 million, or 49 cents per share, from $60.7 million, or 65 cents per share, a year earlier.
The company, which designs, markets, distributes and licenses apparel and accessories, said sales fell 6 percent to $635.4 million.
Analysts on average were expecting earnings of 50 cents per share, on revenue of $630 million.
Shares of the company fell to $27.85 in after-hours trade. They closed at $33.54 on Wednesday on the New York Stock Exchange.
The Co-operative Group has said it sees no letup in the tough environment for consumers, as it posted a 55% drop in pre-tax profits in the first half of the year.
With annual sales of more than £13bn, the group is regarded as a bellwether of the UK’s economy because of the broad spread of its consumer businesses, which include retail and banking as well as farming and travel.
Overall sales at the group inched up 0.2% to £6.6bn, as profits before tax and member payments – the equivalent of pre-tax profits at a public company – tumbled to £69m.
The Co-operative blamed the poor results on the “tough headwinds of the unrelenting consumer downturn”. Peter Marks, chief executive of the group, said: “A year ago I warned that we were operating in the worst conditions that I have seen in more than 40 years in business. The results we are announcing today show the full impact of that.”
He expects an improvement in sales and profit in the second half. “The environment is tough and we see no letup in that. But we believe that the work we have done over the past five years to scale up in our core businesses means we are better placed than ever before to thrive when the economic upturn does come.”
The company said the impact of the downturn was most keenly felt in the banking division, as businesses failed to pay back loans, and the Bank of England kept interest rates at record lows.
Co-operative food stores also suffered amid “fierce” competition from supermarkets. The group said its 3,000-strong convenience stores were also hurt by the wet weather as people drove to supermarkets rather than walk to local shops.
The results come at the end of a busy half for the Co-operative Group, which saw its banking division agree to buy 632 branches from Lloyds Banking Group, and the announcement that Marks would step down as chief executive next May.
Upscale retailer Woolworths beats analysts’ forecasts with a 24 percent rise in full-year profits, which helps boost the share price by over 2 percent to 56.80 rand.
Woolworths, which also sells clothes in South Africa and Australia, says profit was helped by share buy backs and resilient demand for its high-end grocery products.
Its shares are some of the best performing on Johannesburg’s Top-40 index having gained over 40 percent this year, compared with a 10 percent rise by the benchmark index.
NEW DELHI: Dubai-based Landmark Group targets $1 billion, or about Rs 5,500 crore, business in India in the next two years, its vice-chairperson Renuka Jagtiani said.
The $4.7-billion (approx Rs 26,000 crore) group, which operates Lifestyle and Home Centre retail chains in the country, recorded revenues of about $600 million (about Rs 3,000 crore) last fiscal.
“India is growing well and we believe it’s a big potential market for us,” Jagtiani, wife of Landmark founder Micky Jagtiani, said over phone from Bangalore, where she is on a two-day visit.
She said the company’s India business has been growing 30-35% a year for the last five years and the firm aims to maintain that rate in the coming years. Kabir Lumba, MD of Lifestyle International, said the department chain will increase its retail space to about 5 million sq ft in the next two-three years from 3 million sq ft at present.
In recent months, Landmark has announced franchisee agreements with French supermarket operator Auchan Group and US-based coffee chain Krispy Kreme.
Landmark signed up with Auchan after its seven-year franchise deal with Amsterdam-based Spar International ended this year. Landmark will rebrand all 13 Spar stores into Auchan by the last quarter of this year, and plans to add 12-15 Auchan hypermarkets in the next one year or so.
The company will roll out the first Krispy Kreme doughnut-cum-coffee chain in Bangalore later this year.
Cape Town – Shoprite Holdings [JSE:SHP] on Tuesday posted a 17% increase in trading profit to R4.665bn in the year to June 2012, with turnover increasing 14.4% to R82.731bn.
Headline earnings per share rose 19.6% to 607.04 cents.
The tading giant declared a final dividend per share of 194c (2011: 165c), an increase of 17.6%.
Chief executive Whitey Basson said the results is testament that the group is able to perform well despite adverse market conditions.
The turnover increase of 14.3% in its supermarkets in an environment in which internal food inflation averaged 4.9% represents real growth in excess of 9%.
“That we managed to keep internal food inflation almost 4 percentage points below the official rate of 8.8%, reflects very positively on the group’s commitment to keep food prices as low as possible,” he said.
Basson said this will stand consumers in good stead in the coming year if the speculated price increases become a reality to the extent of economists’ current forecasts.
Turnover accelerated in the second half of the year – from 13.2% to 15.7% – while food inflation came down, providing some reprieve for consumers.
This slight buoyancy in the market has persisted after year-end but it is doubtful whether it will last as food prices are bound to rise in line with international markets.
The past 12 months was also a gratifying period that saw the Group appointing its 100 000th employee, having created more than 7 000 new jobs as a result of its successful store opening programme.
Shares in Shoprite are up about 15% so far this year, reflecting expectations of healthy returns from its expansion into the rest of the fast-growing continent.
Shoprite, which earns 10% of its sales from supermarkets outside South Africa, raised R8bn in June for expansion
Hubert Joly, CEO of the global hospitality and travel management company Carlson Rezidor Hotel Group, in Mumbai, India.
Best Buy Co. (BBY), the consumer- electronics retailer shunning a takeover attempt by its founder, will pay its new Chief Executive Officer Hubert Joly a base annual salary of $1.175 million.
Joly will be eligible for a fiscal 2014 bonus of at least $8.75 million, the Richfield, Minnesota-based company said today in a regulatory filing. Best Buy will give Joly $3.5 million and various stock awards to cover compensation he forfeited by leaving his previous employer.
The 53-year-old Joly, CEO of hotel operator Carlson Cos., will start at Best Buy in September, replacing interim CEO Mike Mikan. Richard Schulze, who had been chairman, left Best Buy in June and is trying to purchase the company for as much as $9.5 billion with the help of private-equity partners.
Best Buy reported second-quarter profit today that trailed analysts’ estimates and suspended its earnings forecast as sales of computers and televisions dropped. Net income fell 91 percent to $12 million, or 4 cents a share. Excluding certain items, profit was 20 cents a share. The average of 21 analysts’ estimates compiled by Bloomberg was 31 cents.
Building shopping centres is fraught with difficulties. Just ask the people of Bradford. Their city centre is blighted by a large building site, dubbed the Bradford Hole, where work on a new Westfield shopping centre was halted four years ago. Occupy Westfield protesters recently set up camp there for five weeks but have left again.
In nearby Leeds, however, it’s a different story. A new shopping centre the size of 13 football pitches and crowned by a sweeping glass dome is due to open there next year, the largest project of its kind in western Europe. Trinity Leeds will have a million square feet of space with 120 shops, 12 restaurants, bars and cafes and the biggest Everyman cinema in Britain. As if that were not enough, work is due to start on another huge city-centre mall in 2014.
The company behind the £350m Trinity Leeds project, Land Securities – Britain’s largest property developer – has taken a big gamble. It already owns the White Rose mall outside Leeds, which is its most valuable retail asset. But despite the recession, the company reckons Leeds is hungry for new shops.
Trinity Leeds, named after the nearby 18th century Holy Trinity Church, could easily have fallen victim to the financial crisis. But after being put on ice for 15 months it is now due to open in March.
“We weren’t going to leave a big sandpit in the city centre,” said Gerald Jennings, Land Securities’ portfolio director for the north and Scotland. He describes the project as a game changer for the city, which will have a ripple effect on other businesses. “We’re the first to commit to a large-scale scheme in Leeds and we’ve been here for a long time. City centre schemes are tough to put together. You’ve got to buy up a lot of interest. There are only a few people who can do this. You do need that financial strength behind you.”
Back in Bradford, Westfield insists its mall is back on track with a revised, slightly smaller scheme. The Australian developer recently signed up Marks & Spencer and Next as anchor tenants in addition to Debenhams, but will not restart construction until it has pre-let more space to other retailers.
Despite the problems in Bradford, Hammerson – one of Land Securities’ biggest rivals – also believes it has the financial strength to make a new scheme work in Leeds. The company, which owns shopping centres around the country including Brent Cross in London and the Bullring in Birmingham, hopes to start construction of a £120m, 400,000 sq ft mall called Eastgate Quarters in 2014. It originally envisaged a £650m mall of the same size as Trinity Leeds, and the size of a second project phase will depend on market conditions.
Its two shopping streets will be modelled on the nearby Victoria Arcade, home to luxury retailers including Harvey Nichols and Louis Vuitton. Leeds is renowned for its old shopping areas, with the city’s Cross Arcade providing a home for Michael Marks’s famous penny bazaar when it moved from the outdoor market in 1894. Hammerson is now trying to buy Victoria Arcade to gain a “front door” for its project, which was put on hold in late 2008. Rents look promising. Earlier this year L’Occitane paid £270 a square foot – a rate not seen in Leeds since 2007.
In another important step, Hammerson recently secured John Lewis as an anchor tenant for Eastgate Quarters and is close to agreeing a pre-let. Land Securities had been talking to the department store as well, and was disappointed not to be able to accommodate it at Trinity Leeds.
Both companies, however, believe their malls will be able to exist side by side, with Eastgate Quarter targeting luxury brands and Trinity Leeds traditional high street retailers including Mango, Hollister and Cult.
Trinity Leeds has eight entrances and is surrounded by Leeds’s three busiest shopping streets, as well as being close to the train station, one of Britain’s busiest rail terminals. The mall has shops on three levels and is topped off with a glass dome which fans out from the ground and leaves the centre open at the sides to give it an airy feel, less like an enclosed mall.
Another draw will be a new 13,000-seat music venue, Leeds Arena, which is due to open its doors by early summer next year.
Trinity Leeds will create 3,500 retail jobs – about the same number as at its out-of-town White Rose mall – and up to 1,000 temporary construction jobs with 50 apprentices also being trained on site.
The centre will be the only major mall to open in the UK in 2013, while the projected completion of 355,000 square feet of shopping centre space across the country this year is the lowest annual figure since the early 1960s.
Some 80% of the shop space at Trinity Leeds has already been let to retailers led by Marks & Spencer, Primark and Next. Shop rents are expected to range from £250 to £300 a square foot. With the city ranked the fourth biggest shopping destination in Britain in terms of spending – behind London’s West End, Glasgow and Birmingham – Land Securities and analysts are confident that it will be a success.
Land Securities also wants to expand White Rose, which opened in 1997. Some retailers, including New Look, Primark and the shoe shop Office, are taking space both at White Rose and its larger sister in the town centre. Harm Meijer, an analyst at JP Morgan Cazenove, thinks Land Securities will do fine in Leeds and that the city will become one of its biggest development profit drivers. “Leeds is getting busy indeed, but I would be more worried for those who may get squeezed,” he said.
Shopping centres are desperately trying to keep up with changing customer habits and tastes. Land Securities provides free Wi-Fi at all its malls, and large digital interactive screens with music, information and games will be dotted around Trinity Leeds. Retailers will also do their bit. New Look will have iPads for the public to use at its store.
The old rule of thumb was that restaurants, bars and cafes made up 10% to 12% of shopping centres, but that figure has risen to 20%. “Modern schemes have to have more leisure,” said Land Securities’ chief spokesman, Donal McCabe. “People are going [to malls] less often but are staying longer. You can’t eat out on the internet. Even in the downturn, the leisure spend has held up better than the retail spend.”
Waitrose is to launch a new apprenticeship scheme in September.
The scheme will last 12 months, offering up to 200 apprenticeships throughout the business.
Each apprentice will receive a Level Two Retail Apprenticeship qualification once the scheme is completed, which is open to school leavers with “little to no experience”.
For the first time in its history, Selfridges London will be devoting all 24 windows to one brand – Louis Vuitton’s special collaboration with Yayoi Kusama.
The 83-year-old Japanese artist has teamed up with the luxury design house on a capsule collection all featuring her signature dot print.
Under Marc Jacobs’ genius direction we saw the first instalment of the collaboration launch in stores last month, but the second drop will now be stocked exclusively at Selfridges from Friday 24th August until its global release in October.
To celebrate, the department store will open up a concept boutique dedicated to the collaboration inside the famous department store on London’s Oxford Street, as well as decorate each of its 24 windows in tribute to the artist’s colourful style.
What’s more, Louis Vuitton has released two short films starring blogger Bip Ling as part of a spot the difference competition. In the clips, Bip is seen replicating in movement the verses of a poem written by Kusama, with viewers invited to spot the five differences between the two films.
South African supermarket chain Shoprite said yesterday it would spend $205 million on property development in Nigeria to overcome a lack of infrastructure and capitalise on rising consumer spending.
Africa’s top retailer, which reported a 20 per cent jump in full-year earnings, is pushing aggressively into underdeveloped, fast-growing markets on the continent, with a focus on Nigeria – Africa’s most populous country – and oil-rich Angola.
But its expansion, like those of other South Africa retailers, has been hampered by the lack of shopping malls in most parts of the continent.
“I think we are going to see more and more of these property investments in the rest of Africa because many of these markets have great opportunities, but little or no infrastructure,” said Ron Klipin, a portfolio manager at SA Stockbrokers.
Shoprite said it planned to open nine new stores in Nigeria by the middle of next year, bringing its total to 13, and 21 new stores in Angola.
Wal-Mart Stores Inc. has been slow in its Africa expansion a year after taking 51 per cent stake in domestic retailer Massmart, underscoring the lack of retail infrastructure.
Shoprite missed forecasts by a 20 per cent rise to 607 cents in full-year profit on Monday, as nagging unemployment and rising debt levels put pressure on consumer spending. That was below the average estimate of 617 cents in a Thomson Reuters poll of 13 analysts.
Headline EPS, the main measure of profit in South Africa, excludes certain one-time items. But shares in the company climbed 2.35 per cent to 159.90 rand, extending gains so far this year to 18 per cent and reflecting expectations of healthy returns from its expansion on the rest of the continent.
On September 8th, GAME will close its flagship Oxford Street store.
The shop is closing due to the expiration of the lease and the store’s staff have been relocated to other stores on a temporary basis. GAME is exploring ‘other retail options’ for a new West End store.
“We can confirm that we will be closing our Oxford Street store on 8th September 2012 due to the expiration of the lease.
Our West End customers can visit our concession in Hamleys on Regent Street, our flagship store in Westfield Stratford, or our websites at http://www.game.co.uk or http://www.gamestation.co.uk,” a GAME spokesperson wrote.
“We also have stores in Hammersmith, Surrey Quays, and Westfield White City.
“We’re actively looking at other retail options in the West End, and the Oxford Street team have been temporarily relocated to other stores across London and the South East.”
Nike is preparing to test the limits of sneakers fan’s patience this fall – as they launch their most expensive shoes ever but put a halt to their famous midnight launches.
At $315 the LeBron X’s will be Nike’s priciest sneakers to date after the Oregon based firm hiked their costs by five to ten percent to reflect increased production costs and a decline in profits.
And on top of the financial demand made to their devotees, Nike will no longer sanction midnight launches for their new line after recent outbreaks of violence at malls and Nike stores amongst those who have camped for days at a time to get their hands on the sneakers first.
The new LeBron X sneakers. Which some analysts have said will retail for $315
Known for their superstar endorsed products such as Air Jordan’s, the new LeBron X’s will come complete with motion sensors to measure exactly how high the wearer jumps.
The sneakers were unveiled by NBA superstar LeBron James during the 2012 gold medal basketball game between the United States and Spain at the London Olympics.
However, Nike have said that they are not pushing up prices in an effort to squeeze consumers.
‘We are constantly looking at ways to enhance the product line with the new innovation and product attributes,’ said Nike spokesman Mary Remuzzi to the Wall Street Journal.
Some though, have reacted with outrage to the price hike at a time of economic uncertainty in the United States.
‘As unemployment ravages the working class, our lower and higher education systems shudder in crisis, and murder decimates our forgotten urban poverty zones, Nike is rolling out it first $300+ sneaker,’ said Hamilton Nolan on Gawker.
‘But mom, you don’t understand – it’s worth it.’
Indeed, the president of the National Urban League to drop the price for the new sneakers, saying that he has taken ‘incessant phone calls and emails’ from angry consumers who can’t afford the new shows.
Marc Morial, who is president of the civil-rights group and the former mayor of New Orleans, responded to the reports on Tuesday from the Wall Stree Journal about the apparent price hike.
‘It’s the consumer’s choice after all, but it’s insensitive to market a $300 shoe to kids and teenagers as people are going back to school and struggling to buy school supplies,’ said Morial to the Wall Street Journal.
‘This is not food, this is not rent, it’s a single pair of sneakers.’
Consumer groups have taken to task LeBron James and Nike for the latest sneaker endorsed by the basketball player
Outrage against the pricing has quickly spread, with members of the public openly wondering why Nike are starting the line at such a high price.
‘Prices are getting crazy excessive and as long as we continue to buy sneakers, Nike is going to keep increasing the prices,’ said Donell Brown, 30, who owns a cleaning services company in Dearborn, Mich.
‘Mr. Brown said he and his friends have been posting messages on Twitter and YouTube, urging other longtime sneaker fans not to buy the pricier LeBron shoes and to forgo waiting in line for new sneaker releases.
‘Nike’s price increases are also being felt at the lower end: The venerable Converse Chuck Taylor All-Star sneaker now costs $50 compared with $45 a year ago.’
The LeBron 9 retailed for $170 when it was launched, but the latest shoe endorsed by the Miami Heat superstar is almost twice as much.
However, Nike have responded to the Journal’s story calling the price ‘inaccurate’, stating that the shoe is available without the motion detector embedded in the sneaker.
‘The LeBron X will be launched in the fall at a suggested retail price of $180,’ said Brian Strong in a statement to ESPN.
‘The initial introduction of the LeBron X will be the red, white and blue Nike+ enabled version and that price is still being set, but will be at a higher price to reflect the Nike+ technology embedded in the shoes.’
At the same time as Nike are facing a backlash for the LeBron X price, they are issuing a memo to all official Nike retailers to no loner pre-sell or take reservations for shoes and to ban midnight openings.
‘If a retailer offers Nike products for sale under circumstances where the retailer knows or should know that consumer response is likely to be exceptionally high, it must do so in a prudent and responsible way,’ said an official memo seen by the Wall Street Journal.
‘Retailers should assess what measure are necessary to secure the store and ensure the safety of personnel and consumers.’
In February, Foot Locker canceled the release of the $220 Nike Air Foamposite shoe when 100 Orlando police in riot gear arrived to break up fights that had started among customers camping out for the 4 a.m. release of the sneaker.
Roberto Cavalli S.p.A., a major Italian brand, has opened a flagship store in Hong Kong, which is the brand’s second largest store in Asia.
Located in Pacific Place, an upscale shopping mall in Hong Kong, the Roberto Cavalli store is a 320 square metre facility. The design of the store reflects the modern elegance and glamour of the Cavalli world. The material palette used for the boutique consists of finest materials, many of which have been exclusively produced for Roberto Cavalli in Italy.
The space has been carefully divided into various sections, which emphasises the various product categories present in the store. The store will also have a special VIP room, complete with unique evening dresses.
The Pacific Place store will offer the women’s prêt-à-porter collections, accessories, eyewear, perfumes, as well as the first appearance of men’s prêt-à-porter collections, kidswear and time-wear collections in Hong Kong.
The new store represents the concept ‘global fashion store’ of the House, which has already been extended to other major fashion stores around the world such as London, Paris, Tokyo and New York.
Geneva Watch Group today unveiled its new product line with the iconic boat shoe brand, Sperry Top-Sider. The partnership represents Sperry Top-Sider’s expansion as a lifestyle brand, with the debut of Sperry fashion and sport watches in spring 2013.
As a leader in fashion and technical watches, Geneva Watch Group is strategically matched with the formidable Sperry Top-Sider brand, the inventor of the boat shoe and a leading global nautical performance and lifestyle footwear brand for men and women.
“With resurgence in American heritage brands among the Gen Y and Millennial consumers, the addition of Sperry, an iconic Americana brand, helps broaden the Geneva portfolio by expanding our reach to this important group,” said Geneva Watch Group CEO Jeff Gregg. “Sperry Top-Sider enhances our category breadth from broad sports performance to fashion and classic vintage styles.”
Like the performance-meets-style Sperry brand itself, the inaugural Sperry Top-Sider watch collection includes vintage design elements drawing inspiration from the iconic AuthenticOriginal® boat shoe silhouette and from the dashboard gauge-tech of vintage motor boats. A key style in the collection, the Authentic Original One-Hand Watch, exemplifies modern prep styling built around a vintage nautical design aesthetic.
“Sperry Top-Sider is not only an iconic brand, it’s a way of life,” said Craig Reingold, President of the Sperry Top-Sider brand. “We have formed strong connections with our consumers and are receiving hundreds of requests for Sperry products beyond footwear. We are excited to work with Geneva to bring forward this inaugural watch line next Spring with an assortment of watches that truly embody the Sperry design aesthetic. Sperry fans should stay tuned as there are more Sperry accessories forthcoming early next year.”
The suggested retail price of the collection ranges from $95.00 – $250.00, and will be available through department stores and other retailers, as well as online partners.
Fashion retailer Next is to launch its first garden centre in the north west following successful trials down south.
The group has announced plans to branch out following its recent successes in Shoreham, West Sussex, and Martlesham Heath, Ipswich.
The retail giant now has plans to open similar stores across the UK in 2013, including one at Warrington Gemini Retail Park.
The stores will offer all Next clothing and homewares and will have sections selling DIY products, flooring and plants.
The Next garden centre in Warrington is due to open early next year. Plans have been delayed following a fire at the store in July. Following refurbishments, the store will re-open on Thursday.
A burger chain based in Toronto has followed Tim Hortons into the Middle East, a sign Canadian eateries are still hungry for growth in the region.
South St Burger on Friday opened a restaurant in Dubai’s Ibn Battuta Mall, and plans further expansion in the region, in its first venture outside Canada.
The move follows last year’s entry of the Canadian coffee chain Tim Hortons, which has plans for a total of 120 outlets in the Middle East.
Asad Mahmood, the operations manager for South St Burger in Canada, in Dubai overseeing the launch, said the Ibn Battuta outlet would be followed by a restaurant in Jumeirah this year. “Right now, South St Burger is only in Canada. This is the first overseas franchise,” he said.
Mr Mahmood said there were plans for at least five restaurants in the UAE. “We want to do five in a year. If we get better locations, we can get more than that. The UAE is a growing market. Every chain from all over the world – from retail to food – is here.”
South St Burger, which was launched in 2005, is owned by the Canadian chain New York Fries, which has had a presence in the Middle East for many years.
Al Awael, the franchise partner for New York Fries, is also the local partner for South St Burger in the UAE, according to the Canadian company. No one from Al Awael could be reached for comment.
Tim Hortons launched in the UAE with a high-profile marketing drive.
Mr Mahmood said South St Burger would advertise its entry into the Middle East in local media and on billboards.
“We do have a marketing plan. But obviously we won’t be able to do what Tim Hortons did because [it is] a huge company,” he said.
Sahar Zareei, the operations manager for South St Burger in the GCC region, said the chain planned further branches outside the UAE.
“We are going to launch in other [Arabian] Gulf countries – anywhere we see the demand.”
The eat-in restaurant at Ibn Battuta has received more than 500 customers since opening on Friday, Ms Zareei said.
“We actually had a Canadian from Toronto. He was very happy to see South St Burger here.”
Ron Murphy, a Canadian citizen who lives in Dubai and works in operations at Emirates-CAE Flight Training, said he would pay a visit to the new restaurant.
“I’ve only had South St Burger a few times back home but any time a Canadian brand comes to the UAE I think it’s great for us,” he said.
But Mr Murphy added the brand was not as well known as Tim Hortons.
“Tim’s has been around for a long time.
“It’s like an institution back home, around every corner. It’s kind of like the Starbucks of Canada,” he said.
“South St is still growing – I don’t think they’re that popular yet. It’s a little bit more upscale than the fast food stuff that you get. It’s good.”
Forever 21, the US affordable fashion retailer, has opened a 24,000 sq ft new format store at Bluewater.
The store opened on August 18 and stocks Forever 21’s full range of womenswear, menswear and accessories.
Forever 21 is the latest in a series of brands to choose Bluewater for new concepts. In the last six weeks, Mappin & Webb, Crocs, Beaverbrooks and Caffè Nero have all opened new store designs at the centre. In addition, Triumph, Chisholm Hunter, Aldo and Dwell are currently fitting out.
The nine new brands bring the total area of new stores to commit to Bluewater in the last six weeks to 38,277 sq ft.
Guy Thomas, head of retail leasing at Lend Lease, said: “Bluewater has once again proved its appeal to some of the most successful and prestigious brands in the world. Forever 21 and Mappin & Webb, for example, are significant additions to our cosmopolitan retail mix that is very attractive to the affluent and brand-focused guests that dominate Bluewater’s catchment.
“That they are being joined by a large number of other exciting new brands across a wide range of sectors further enhances Bluewater’s offer and appeal as a unique day-out destination.”
DTZ, CBRE and Shelley Sandzer acted for Bluewater. Harper Dennis Hobbs acted for Forever 21. Kitchen La Frenais Morgan acted for Triumph.
Britain’s National Health Service (NHS) plans to sell its brand rights around the world, including to the oil-rich Middle East, as part of a new venture to boost income.
The venture may see well-known hospitals such as Great Ormond Street become a worldwide franchise.
The government will launch Healthcare UK to act as a consultant for hospitals and potential overseas clients in the autumn. The body will also represent private healthcare firms such as Bupa and drug companies including GlaxoSmithKline.
The scheme, which has been put together by the Department of Health and the UK Trade and Investment department, is aimed at increasing funds into the health service.
The proposal is inspired by medical facilities in the US, such as the Cleveland clinic and Johns Hopkins, which have both opened branches abroad. Potential markets include the Middle East, India, China and Brazil.
The government pointed to British medical services that are already working in several Middle Eastern countries. Moorfields Eye Hospital operates a branch in Dubai while Imperial College London formed a joint venture with Mubadala, Abu Dhabi government’s investment vehicle, for a diabetes centre in 2006.
Senior executives from the South East Coast Ambulance Trust also recently visited Libya where the post-Gaddafi regime is rebuilding its health service.
“This is also good news for the economy which will benefit from the extra jobs and revenue created by our highly successful life sciences industries as they trade more across the globe,” Anne Milton, Health Minister said.
“The NHS has a world-class reputation, and this exciting development will make the most of that to deliver real benefits for both patients and taxpayers,” she added.
Governments in the GCC are spending billions of dollars on improving healthcare facilities amid a rising rate of lifestyle diseases such as diabetes, obesity and heart disease. The number of people suffering from diabetes in the MENA region is expected to double from 366m in 2011 to 552m by 2030, according to the International Diabetes Federation.
Four of the Gulf states are ranked amongst the world’s top ten fattest nations with Kuwait the second fattest country in the world behind the United States, according to a research report published by BMC Public Health last month.
Saudi Arabia has earmarked US$73bn for building hospitals and healthcare centres in the kingdom over a four year period while Abu Dhabi has partnered with the Cleveland Clinic to improve healthcare conditions within the emirate.
Picture: THE TIMES
SOUTH African retailer Shoprite Holdings missed forecasts with a 20% rise in full-year profit on Tuesday, as nagging unemployment and rising debt levels put pressure on consumer spending.
Africa’s largest retailer said headline earnings per share totalled 607c in the year to end-June, from 507.6c a year earlier.
That was well below the average estimate of 617c in a Thomson Reuters poll of 13 analysts.
Sales rose 14.4% to R82.7bn, with its smaller operations outside its mainstay South African market lifting sales by 25.4%.
“The past 12 months were also a gratifying period that saw the group appointing its 100,000th employee, having created more than 7,000 new jobs as a result of its successful store opening programme,” CEO Whitey Basson said.
The retailer’s full-year trading profit reached R4.665bn, a 17.02% increase from a year earlier.
“The business environment remained largely unchanged from the previous reporting period. South African consumers, beset on all sides by the challenges of rising debt and increased living expenses, continue to face persistent high levels of unemployment, rising electricity, schooling and transport costs, and the impact of a weaker rand, which affected the prices of all imports,” Shoprite said.
“However, the government played its part in assisting consumers and the economy by keeping interest levels at their lowest in 30 years while continuing the payment of social grants, from child maintenance to old-age pensions, to an increasing number of low-income recipients,” the retailer said.
It declared a final dividend of 194c, a 17.6% increase from the 165c declared in 2011.
Shoprite is the first of three major South African retailers to post results this week.
Shares in Shoprite have risen about 15% so far this year, reflecting expectations of healthy returns from its expansion into the rest of the fast-growing continent.
Shoprite, which earns 10% of its sales from supermarkets outside South Africa, raised R8bn in June for expansion.
Apple is about to start selling its products directly in Russia, and will look into opening retail stores at some point in the future, according to a report in today’s Moscow News.
In order to expand into Russian territory, Apple as registered a company called Apple Rus and assigned Vitaly Morozk, the company’s local legal advisor as its director general.
It is alleged that Apple executives travelled to Moscow in 2011 to find premises for an Apple store but did not find anything suitable. Apple opened the iTunes Store online in 2009.
According to Moscow News Apple could begin selling products directly in 2013, but it is unclear if and when any Apple stores could open.
Apple’s products in Russia are distributed via an array of third-party companies that work with Apple. The iPhone is distributed by Vimpelcom and MTS, while computers are largely distributed via diHouse, Marvel and OSC. Prior to 2009, however, most iPhones were imported into Russia via the grey market.
The new company, Apple Rus, is likely to begin by concentrating on distribution in Moscow and St Petersburg with the other companies working in other regions.
“You can often hear the opinion that as soon as Apple Store comes, the prices will fall,” said spokeswoman for Re:Store Retail Group, Lyudmila Semushina. “The prices will not fall. For the majority of Apple products, apart from iPhone, we have practically the same prices as in European countries, and they will remain. The products for Russia are not bought in via the U.S.A., but via Europe.”
“The only thing that can change for the better for the consumer is that there will be a smaller delay between announcing a new Apple gadget, and its appearance on the Russian market. But we are not the first place in this market. For Apple there are three major markets: U.S.A., Europe, China, who buy many times more than Russia,” Semushina told RIA Novosti.
Port Elizabeth’s iBhayi area will become a major urban retail hub with the development of the R195 million Kinako Mall at the intersection of the R75 Uitenhage Road and Spondo Road.
The development of the mall, which opens in April next year is seen as long overdue to serve a prospective catchment area of 340 000 customers with a total estimated retail potential of R1.22 billion.
The 20 000m2 mall is a 50/50 joint venture development between the Shoprite Group and African Dune Investment. It has, say the developers, a potential to expand up to 30 000m2 and a total of 82 shops. Anchored by a 4000m2 Shoprite store, the mall has also already attracted major retailers that include Clicks, Truworths, Jet, Edgars Active, Ackermans, Pep, Mr Price, Identity, Legit, OK Furniture, Morkels, Capitec, Cashbuild, Home Express, Torga, Franco Ceccato, Rage, Roland’s, Hungry Lion, and Chingo. There will be 995 parking bays and a taxi area to accommodate 37 vehicles.
Kinako Mall is strategically located to serve the areas of Bethelsdorp; Algoa Park; Kwazekele; Soweto-on-Sea; Zwide; Kwadwesi, Kwamagxaki; Masibulele; New Brighton; Kwaford and Struandale. The site has high visibility from the surrounding highways and arterial roads and is close to the Nelson Mandela Metropolitan University Missionvale Campus, the Eastern Cape Training Centre and the Dora Nginza Hospital.
A spokeperson of Shoprite Group said his company was committed to bringing shopping closer to the community and was gratified that most of South Africa’s leading retailers had joined them in providing a wide selection of food and fashion retail to a community that had been neglected for years.
Gerhardt Jooste, of Prosperito, the 100% shareholder in African Dune, said the mall would have ‘all the important elements – a great location, fantastic exposure, with 27 000 vehicles passing the site daily and 340 000 people living in the catchment area’.
Architect Garth Hamilton of Stauch Vorster, said the architecture was an example of successful design ‘that responds to the specific of site and functionality.’
The layout comprises a combination of an exterior strip mall on an external walkway, leading into a covered internal mall The materials used would be combined to further enhance the design and are functional, robust and beautiful. ‘The natural clay and polished concrete will create an unencumbered backdrop for the display of the tenants’ merchandise.
No injuries reported
Dubai Mall shoppers were caught by surprise when a small fire led the mall management to shortly evacuate its premises.
No injuries have been reported.
Meanwhile, Dubai Media Office in a statement on Twitter said “fire in one of the restaurants at Dubai Mall has been brought under control”.
It was handled smoothly and professionaly, said a customer service representative.
The news spread quickly on twitter where nearby shoppers posted pictures and made reference to the mall fire in Qatar earlier this year, complimenting good management of Dubai authorties.
Dubai: Plumes of smoke billowed from an area on the second floor of Dubai Mall around midday on Tuesday, prompting mall officials to cordon off the area as fire officials responded to the scene.
By 12.20pm, four fire trucks and ambulances arrived on scene at the fountain area between Dubai Mall’s southwestern wall and The Address Hotel, Downtown.
One official told people working inside the mall around 12.30pm that the incident was under control.
Authorities contacted by Gulf News confirmed there was a fire but declined to confirm details until later on Tuesday.
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Emaar officials could not be reached and no statement was forthcoming from the owners of Dubai Mall.
Investigations into the incident continue.
Women’s apparel retailer Ann Inc, the parent of Ann Taylor and LOFT stores, topped profit expectations for the eighth quarter in a row, as sales boomed for its affordable and bright-colored clothes.
Shares jumped 20 percent to their highest in nearly five years as the company edged up its sales forecast for the year.
New York-based Ann, has reduced promotions at both its brands and is offering products at lower starting prices to spur full-price sales.
The company and its peer Chico’s FAS Inc, whose chains cater to women over the age of 30, have been revamping their assortments to drive traffic and take a bigger slice out of their shoppers’ budgets.
Piper Jaffray analyst Neely Tamminga noted that improved fall and holiday assortments as well as better inventory management would result in earnings growth at Ann.
Tamminga raised her rating on the company to “overweight” from “underweight” with a price target of $37.
Ann shares were trading up $5.51 at $33.65 in early trading on Friday on the New York Stock Exchange.
The company has been turning around its Ann Taylor brand, earlier known for its office wear, by adding colorful designs, opening chic ‘concept’ stores and roping in actress Kate Hudson to endorse its collections.
While the Ann Taylor brand targets an older clientele, LOFT offers casual clothes for younger shoppers.
The company expects full-year sales of $2.39 billion, up from the $2.38 billion it forecast earlier. Analysts were looking for revenue of $2.37 billion.
For the third quarter, the company forecast sales of $600 million, compared with analysts’ estimate of $605.7 million.
The company in May revealed plans to open two of its Ann Taylor stores in Toronto in the fall of 2012.
On a post-earnings conference call, Ann said it expects to open more stores for both its brands in Canada in October and November.
Fewer promotions in the fourth quarter helped increase gross margins to 55.9 percent from 55.0 percent a year earlier.
Profit rose to $30.7 million, or 63 cents per share, from $24.8 million, or 47 cents per share, a year earlier.
Revenue increased 7 percent to $594.9 million.
Analysts on average had expected earnings of 51 cents per share, on revenue of $585.6 million, according to Thomson Reuters I/B/E/S.
A German daily deals company is bidding for LivingSocial’s Middle East assets in what it described as a “fire sale” by the loss-making business.
The Düsseldorf-based Mox Deals is one of three players in the running to buy LivingSocial’s regional assets.
The company’s bid is “much less” than LivingSocial’s US$3 million (Dh11m) asking price, said Frank Scheunert, the chief executive. “We’re bidding very low. Nobody would give them $3 million.”
It emerged last week that LivingSocial had been in discussions with a number of potential buyers to sell its subscriber bases in the UAE, Egypt and Lebanon, amid heavy losses in the region.
“There were about 10 parties interested, and … they only have three concrete bidders left,” said Mr Scheunert.
LivingSocial, headquartered in Washington, is looking to exit the Middle East by the end of the month as it looks to cut its losses in the region’s highly competitive daily deals sector.
“It’s a fire sale,” said Mr Scheunert. “They spent all the money the mother company allocated to them. They have so much pressure from [the United States] that they just have to get out. It’s within 10 days I would say.”
Mox Deals already offers daily deals in the UAE, as well as in Germany, the US and Singapore. Mr Scheunert said it was also considering launching in Saudi Arabia, Vietnam and Malaysia.
The company is listed on the Frankfurt Stock Exchange after a small initial public offering.
Mr Scheunert declined to say exactly how much the bid for LivingSocial’s Middle East operations was worth.
But the executive said he was interested in assets such as LivingSocial’s database of email addresses, thought to number about 750,000, as well as part of its infrastructure and in taking on three or four of its sales staff.
Were a bid by Mox Deals to be successful, the business would be run on an “extreme cost-saving” basis, Mr Scheunert said.
The executive said Mox Deals was looking to target Asian expatriates in the UAE and hoped to make a profit by 2014.
“Mox Deals will not make money within the first year, but maybe the second. Because we are extremely cost-saving,” he said.
More than 20 daily-deals sites serve the UAE, and Mr Scheunert said he foresaw many of those failing.
“Out of the 20 websites, there will be 10 to 15 insolvencies. And the last five will merge to one,” he said.
Groupon yesterday ruled out bidding for the LivingSocial subscriber database.
Alexander Kappes, the chief executive for Groupon Middle East, said the email list offered little value to his operations.
“Groupon has twice the LivingSocial subscribers,” he said. “There will be a high percentage of doubled-up subscribers if we were to buy the database, so for us, the added value is almost nil.”
“We are not interested.”
LivingSocial executives did not respond to a request for comment about a possible sale of its Middle East assets.
But Eric Eichmann, the president of LivingSocial’s international operations, confirmed to staff it was looking to leave the Middle East as it had failed to make a profit in the regional markets in which it operates.
“We are likely to be exiting those markets either through a sale or suspension of those operations in the near future,” Mr Eichmann told employees in an internal email.
Documents seen by The National show LivingSocial has incurred significant losses in the Middle East, and in one month this year it lost more than $500,000.
The company entered the region last year through the acquisition of the local deals site GoNabit for an undisclosed sum.
Mothercare has a launched a children’s fashion collection with Jools Oliver, the wife of celebrity chef Jamie Oliver.
The Little Bird collection includes clothing for babies and children up to the age of five as well as a range of bedding, accessories and gifts.
“I have such a passion for the design of children’s clothes, so to have this opportunity to work with Mothercare is just amazing.” said Oliver.
She added: “My clothes combine both quirky and classic style inspired by my childhood memories. The entire collection has been lovingly put together and accessibly priced for parents. I cannot wait to see the reaction to it.”
Simon Calver, Mothercare chief executive said: “We are delighted to have Jools on board and add the Little Bird collection to our stores. The new product range offers exceptional quality and style at an affordable price, which reflects exactly what our customers tell us they want from Mothercare.”
The Litttle Bird range will be exclusive to Mothercare stores.
Apple shares hit a new all-time high Friday as US stocks closed out the week with a second day of solid gains that put the Dow at its highest level since the last days of 2007.
Apple shares rose to a high of $648.19, after reports that it was nearing the launch of a new iPhone model and a reduced-size iPad.
The stock closed up 1.9 percent at $648.11.
Facebook meanwhile continued its fall, losing 4.0 percent in the second day after pre-IPO investors were allowed to sell their shares. At $19.07, the shares were almost exactly half of the May 18 initial offer price of $38.
The Dow Jones Industrial Average finished up 25.09 points (0.19 percent) at 13,275.20, while the broader S&P 500 added 2.65 (0.19 percent) to 1,418.16.
With the help of Apple, the world’s largest company by market capitalization, the tech-heavy Nasdaq gained 14.20 points (0.46 percent) to 3,076.59.
Trade got a little help from a rise in the University of Michigan Consumer Confidence index, which came in slightly higher than July at 73.6, still well below pre-recession levels.
But consumers’ expectations of future conditions worsened, the sub-index falling to 64.3 from 65.6.
“Clearly consumers feel times aren’t as bad as they were just a month ago, but looking into the future there remains a considerable amount of uncertainty and downside risks that could undermine the recovery,” said Lindsey Piegza of FTN Financial.
Caterpillar added 1.6 percent after tentatively reaching a new contract deal with workers at its Illinois plant who had been on strike since May.
Clothing retailer Gap rose 4.8 percent after turning in a 20 percent rise in second quarter earnings and raising its forecast for the full year.
Sports shoe chain Foot Locker reported a 59 percent rise in quarterly profit, pushing its shares 1.7 percent higher.
US bond prices gained after falling three straight days. The 10-year Treasury yield fell to 1.82 percent from 1.84 percent Thursday, while the 30-year moved to 2.93 percent from 2.96 percent. Bond yields move inversely to prices. – Sapa-AFP
Kingdom Holding, the Saudi firm owned by billionaire businessman Prince Alwaleed, has signed a construction contract to build the world’s tallest tower in Jeddah. US-based Adrian Smith and Gordon Gill are the design architects of the project (All images: © Adrian Smith + Gordon Gill Architecture)
The tower’s height will be at least 173m (568 ft) taller than the world’s current tallest building, Dubai’s 828m tall Burj Khalifa.
At more than 1,000 meters (3,280 feet) and a total construction area of 530,000 sqm (5.7m sq ft), Kingdom Tower will be the centerpiece and first construction phase of the Kingdom City development on a 5.3m sqm site in north Jeddah
Kingdom Tower will feature a Four Seasons hotel, Four Seasons serviced apartments, Class A office space, luxury condominiums and the world’s highest observatory, the building’s design architects, Adrian Smith and Gordon Gill said in a statement Tuesday
Design development of the tower is under way, with construction to begin later. Kingdom Tower will cost approximately $1.2bn to construct, while the cost of the entire Kingdom City project is estimated to be $20bn
The tower will also feature a sky terrace, roughly 30 meters (98 feet) in diameter, at level 157. It would be an outdoor amenity space intended for use by the penthouse floor
Sports footwear retailer Foot Locker Inc’s results beat Wall Street estimates for eight quarters in a row as more customers flocked to the company’s stores, sending its shares up 6 percent before the bell.
The retailer, which sells branded shoes of Nike Inc, Reebok and Adidas AG, has better managed its inventory levels over the past few quarters and has benefited from new and eye-catching designs of athletic gear.
The company — whose products include basketball, running, and casual footwear, as well as apparel and accessories — said profit rose to $59 million, or 39 cents per share, from $37 million, or 24 cents per share, a year earlier.
On an adjusted basis, the retailer posted a profit of 38 cents per share beating analysts’ estimates by 5 cents, according to Thomson Reuters I/B/E/S.
The company, which runs chains including Champs Sports and Footaction, said revenue rose 7.2 percent to $1.37 billion, above the average Wall Street estimate of $1.35 billion.
Foot Locker said comparable-store sales rose 9.8 percent.
Separately, sports good retailer Hibbett Sports Inc also posted second-quarter profit that beat estimates by 2 cents, helped by margin improvement, and raised its full-year profit outlook.
New York-based Foot Locker’s shares, which have risen about 45 percent this year, were up about 5 percent at $36.08 in premarket trading. They closed at $34.49 on Thursday on the New York Stock Exchange.
Shares of Hibbett Sports closed at $61.80 on Thursday, on the Nasdaq.
(Reuters) – U.S. electronics chain Best Buy Co Inc named Hubert Joly, the former head of hospitality and travel company Carlson, as its new chief executive on Monday, hoping to tap the French businessman’s acumen in turning around ailing businesses.
The naming of a permanent CEO ends months of uncertainty at the world’s largest consumer electronics chain stemming from the abrupt departure of its prior CEO, Brian Dunn, in April.
Best Buy shares, which had fallen 11 percent since Dunn’s exit, fell a further 7 percent on Monday as Joly’s appointment was overshadowed by the breakdown of takeover talks with founder Richard Schulze over the weekend, leaving the future of his pursuit of the company in question.
“It is clear to us that there is quite a bit of acrimony between Mr. Schulze and the board of directors and that this distracting saga isn’t close to being finished,” RBC Capital Markets analyst Scot Ciccarelli said.
Best Buy said on Sunday Schulze had rejected its offer to allow him the chance to do due diligence and pursue a takeover. Schulze balked at the board’s requirement that would have prevented him from publicly making a bid for the company.
Schulze said on Monday he would continue to pursue his proposal to take the company private. He also called Joly an “accomplished executive” but said the retailer needed a “leadership team with deep retail experience and knowledge of Best Buy.”
Joly, who most recently was CEO of privately held Carlson in Best Buy’s home state of Minnesota, has never worked in retail, but the 53-year old executive has significant experience improving businesses in the technology, media and services sector.
“He is a little bit older, a little bit more seasoned,” said BB&T Capital Markets analyst Anthony Chukumba. “I think this is a home run for Best Buy.”
Joly faces the tough task of fixing Best Buy, which is struggling to fend off online and discount rivals and shoppers’ tendency to check out gadgets at brick and mortar stores and then buy them for less online.
The company could give clues to its turnaround plan as early as Tuesday, when it is expected to post the eighth decline in same-store sales in nine quarters.
NECESSARY TOOL SET
Joly drove the turnaround of the French business of EDS – now part of Hewlett Packard Co – from 1996 to 1999. He also led the restructuring of Vivendi’s video game business – which was later combined with Activision Blizzard Inc – from 1999 to 2001. In that instance, Vivendi successfully tapped into the growth of online gaming.
Joly’s experience with Vivendi “potentially provides him with the necessary tool set to begin a turnaround at Best Buy,” Ciccarelli said.
At Carlson, Joly strengthened businesses in the customer service sector, including the restaurant and hotel units, which run the T.G.I. Friday’s restaurants and Radisson hotels.
Joly succeeds interim CEO Mike Mikan, who took over after the abrupt departure of Brian Dunn in April during a probe that found he had engaged in an improper relationship with a female employee. The probe also found that Schulze failed to notify the board about allegations against Dunn and led to Schulze losing his chairmanship.
Joly is expected to step into his role as president and CEO in early September when his visa is secured, Best Buy said.
TALKS BREAKING DOWN
Schulze, the 71-year-old former chairman of Best Buy, informed the board earlier this month that he was interested in teaming up with private equity partners to buy the company for $24 to $26 per share.
But Schulze had said there were obstacles to him making an official bid, including his inability to access the company’s financial data.
Best Buy said on Sunday that it had offered Schulze a proposal that would have provided the opportunity to do due diligence and take a buyout offer directly to shareholders.
It said “Schulze declined to participate.”
For his part, Schulze said he was “shocked” by Best Buy’s “abrupt termination” of their talks, adding that they had been negotiating over the weekend and expected to conclude the matter before Best Buy reported earnings this week.
“We had believed we were close to an agreement for a reasonable standstill period and are eager to resume our discussions immediately if the board is truly interested in reaching an agreement in shareholders’ interests,” Schulze said.
Analysts expect Best Buy to lay out a turnaround plan that will focus on building its services business and cutting costs so it can offer lower prices and protect its market share.
“A large-scale turnaround could take two to three years and may be better executed as a private company,” said Jefferies analyst Daniel Binder.
Best Buy shares fell $1.56, or 7.7 percent, to $18.71 in afternoon trading on the New York Stock Exchange.
(Reporting by Dhanya Skariachan and Martinne Geller; additional reporting by Siddharth Cavale; Editing by John Wallace, Maureen Bavdek and Phil Berlowitz)
RETAILERS experienced their biggest one-day fall on the JSE in almost a year on Friday, on negative sentiment towards SA following the deadly labour dispute at Marikana, one of the country’s biggest platinum mines.
“As it is exclusively South African stocks, it may be that Lonmin has scared a few foreign investors,” says Byron Lotter, a portfolio manager at Vestact. “It’s not a long-term thing.”
The general retail index was 3,9% lower at the close of trade on Friday, its biggest percentage fall since September 22.
South African retail shares have been trading at record highs this year, driven by foreigners looking to Africa for an alternative as the sector slows down in Europe and the US. Among the weakest retail stocks were the fashion houses, with The Foschini Group’s (TFG’s) shares falling 5.9% to their lowest in a month. Truworths fell more than 5%.
Michael McLeod, an analyst at Avior Research, said he had expected a possible pullback in retailers, given their strong run.
“We believe that slowing earnings may trigger a switch among investors to other areas of stock markets, such as resources, which look cheap from the valuation point of view. However, it is still early stages to determine whether this is a trend.”
Over the past 12 months, shares in TFG have gained 52%, while those of Mr Price, a mainly cash retailer, have risen 73%. Shoprite, Africa’s biggest grocer, has risen 48%.
“It is too early to be sure, but perhaps we are seeing a sector switch from areas of the market like retailers which are now looking a little more expensive to those which appear relatively cheap,” Shaun Murison, market analyst at IG Markets SA, said.
Shares that have been underperforming for long periods are starting to offer value, he said.
Supermarket giant Tesco has been illegally employing foreign students, a raid on one of its London warehouses uncovered.
Britain’s biggest retailer was swooped on by immigration officials after being tipped off that students were working significantly longer hours than their visas allowed
Overnight raids at the Tesco.com building in Croydon, South London, ended in the arrests of 20 students of 11 different nationalities accused of breaching visa conditions that restricted the hours they could work.
The retail giant Tesco, pictured, could be fined up to £200,000 after the arrest of suspected illegal workers at one of its warehouses
The students, who were predominantly of Bangladeshi and Indian origin, had been working up to three-and-a-half times longer than their visas allowed, according to The Telegraph.
Seven of those arrested by the UK Border Agency have already been deported, while the authority said the rest remain under investigation.
While those arrested, believed to be aged over 18, had student visas and the right to work in the UK , they are alleged to have exceeded their 20-hour-a-week working limit by up to a further 50 hours in some cases.
Tesco now face a bill of up to £10,000 per illegal worker – a total of £200,000 – for the breaches, unless the company can prove it carries out the legally required checks.
A UK Border Agency spokesperson said: ‘We received information that some staff members were working in the UK illegally at Tesco.com on Factory Lane, Croydon. In response officers carried out an operation in full cooperation with the company shortly after 3am on Saturday, July 21 2012.
‘Twenty individuals have been arrested and now face removal from the UK. The operation was part of an ongoing campaign to tackle visa abuse which has seen over 2,000 offenders removed since the beginning of May.
The UK Border Agency said the operation was part of an ongoing campaign to tackle visa abuse
‘The employer now needs to provide evidence that it was carrying out the legally required checks to avoid a fine.’
Tesco, which employs nearly 300,000 people in more than 2,500 stores in the country, were informed by the UK Border Agency about the suspected illegal workers ahead of the raid on the Factory Lane warehouse last month, and agreed to supply them with extra information.
A Tesco spokesperson said: ‘In cooperation with Tesco, the UK Border Agency visited our dot com store in Croydon in July. As a result of this visit, a small number of staff were found to have breached the terms of their working visas.
‘We continue to cooperate fully with the UK Border Agency as they look into this issue. We take our responsibilities as an employer very seriously and do not condone illegal working of any kind.
‘We have a comprehensive system for ensuring all the correct procedures are followed in this area which has been externally audited and generally works well. We have now taken additional steps to ensure an incident of this nature does not happen again.’
VALUE retailer Poundworld is celebrating the opening of its 200th store.
The shop at Newbury Retail Park in Berkshire is the 44th to open this year.
The Yorkshire business claims to be the country’s fastest-growing single-price retailer.
It has created 1,000 jobs in the year to date through national expansion.
Poundworld, which is owned by the Edwards family, said it plans to open another 250 stores over the next five years, which will create more than 10,000 jobs.
The company added: “It is estimated that between 150 and 250 of the jobs created will be based in Yorkshire, and will include positions in retail, distribution and various roles at the head office in Normanton, Wakefield.”
Managing director Chris Edwards senior founded the company in 1997. His son, also named Chris, is the trading director.
Mr Edwards junior said: “After 15 years of offering great choice, brands and deals, we are delighted to have reached the milestone of 200 stores.
“We now serve over 1.5 million customers a week and we are recognised as one of the UK’s leading discounters.”
He added: “The past couple of years have seen an exciting period of growth for us with the launch of two new consumer brands, Discount UK and Poundworld Express, as well as the introduction of our new wholesale website Discountwholesale.co.uk earlier this year.
“We hope to build on this positive growth by opening a further 250 stores by the end of 2017 and we look forward to welcoming even more cost-conscious shoppers through our doors.”
Poundworld has five stores in Leeds at Crowne Point Retail Park, the Merrion Centre, Kirkstall Road, Kirkgate and Crossgates.
In an interview last year, the company directors said the Discount UK multi-price store was filling the gap left by the demise of Woolworths.
The company describes Discount UK as an “up-to-date Woolies, with a vibrant look and more choice and value”.
Mr Edwards junior said: “People want real value – we know this from the millions of customers we serve in Poundworld, and Discount UK can deliver excellent value for money on over 500 products ranging from 28p up to £25.”
New store openings boosted Poundworld’s turnover by 42 per cent to £132.9m, according to figures for the year to March 2011.
Pre-tax profit rose by more than 400 per cent to £5.2m. The gross profit margin in 2011 was 40 per cent.
Poundworld’s shelves are stocked with more than 3,500 individually-sourced product lines.
American fashion retailer Hollister, part of Abercrombie & Fitch, is joining the long list of international retailers headed to Australia with plans to open its first store here next year.
Mike Jeffries, chief executive of Abercrombie & Fitch, revealed the plans for the first Hollister stores in Australia and the Middle East during the annual earnings conference call for the retail giant.
Hollister now has 28 stores in the UK, 12 in Canada and 17 in Germany with plans to open 20 more international stores in 2013.
Jeffries said the rollout is still at an early stage.
“We are focused on underpenetrated markets where we expect minimal cannibalisation,” he said.
Overall, Jeffries said Abercrombie & Fitch’s results were “disappointing” and cited “cannibalisation” as a key concern where Abercrombie & Fitch flagship store, standard stores and Hollister stores cannibalise each other’s sales.
In contrast, Jeffries sees Australia as an untapped market for Hollister as Abercrombie & Fitch has not yet opened in Australia despite reports of the brand scouting for locations here.
“We are confident that the return from investment on our international rollout to date has been superior to any other allocation of capital over that period,” Jeffries said.
New stores opened in 2012 by the Abercrombie & Fitch group are expected to contribute $200 million in sales growth.
Hollister has yearly sales of $485.6 million and offers cheaper and more youth orientated fashion than Abercrombie & Fitch.
Named after a city in California, the retailer stocks surfer style fashions, making it a competitor to local surfwear retailers such as Billabong and Rip Curl.
Hollister has been steadily taking its model global by opening stores in Europe and Canada. Its biggest international push has been into Britain where it has 27 stores, followed by 13 in Germany and nine in Spain. It has also opened a Hollister in China.
While Hollister is likely to be the first store in the Abercrombie & Fitch group to reach Australia, it follows behind other international retailers, including Top Shop, Zara and Gap.
In a report into the retail sector published earlier this year, Morgan Stanley predicted that global apparel brands, Zara, GAP, Topshop/Topman, H&M, Uniqlo, Victoria’s Secret, Abercrombie & Fitch, and Forever 21 were likely to have 182 potential stores in Australia by 2016, delivering $1.9 billion in sales or 6% market share of the apparel market.
LONDON (MarketWatch) — Online grocery operator Ocado Group PLC will launch a price war against rival supermarkets and pledges that its groceries will be cheaper than other U.K. retailers, The Sunday Telegraph reported.
In an interview with the newspaper, Ocado Chief Executive Tim Steiner said the company has plans for price promotions which would be put in place over the next year to encourage more sales.
Mr. Steiner said that Ocado’s growth would increase when the market reached a “tipping point” and consumers believed that shopping with Ocado was cheaper than the alternatives.
He admitted that in the past, the service had been seen as a “premium” product.
“Obviously, we have brought our pricing down over the year but we agree that the market will not reach tipping point until the online market is cheaper than the supermarkets,” Mr. Steiner said.
“It is just not something that is going to go there overnight. It is a journey. Two weeks ago, we launched a pilot in Manchester called the lower price promise, where we are doing a basket match and we guarantee it will be cheaper,” he said.
Mr. Steiner said the “lower price promise” will be rolled out nationally.
Used goods retailer Cash Converters has opened its first store in Dubai.
Located on Sheikh Zayed Road, the franchise store’s customers can sell unwanted goods, buy used items from the store or secure an item with the store’s layby option. Customers can also use the consignment option whereby the store sells the item on their behalf receiving the money once the item is sold.
The Cash Converters business model in Dubai is based largely on the buying and selling of furniture and white goods. Spread over two levels the new store features a children’s furniture section, musical instruments, electronics and jewellery with the whole of the ground floor given over to the large stock of furniture.
“The used goods business is not new in Dubai, however the concept of being able to buy and sell used goods through a store is,” said Fabrice Le Boulenger general manager Cash Converters Dubai. “Cash Converters is a unique retail concept in that the public are both our customers and our suppliers.”
Le Boulenger said that the location of the store was an important consideration when setting up in Dubai. “Our show room location on Sheikh Zayed Road will be a key to our success. Situated close to densely populated expat areas we expect our accessibility will make us a popular buying and selling hub.”
Since launching in Australia in 1984, Cash Converters has built a network of over 600 stores in 21 countries worldwide.
Pressure is mounting on Mothercare’s crucial overseas business as UK rival Mamas & Papas plots a move into China, where it plans to open over 90 stores within the next five years.
The China entry, carried out with franchisee Zero to Seven, is the biggest concentrated programme of store openings in Mamas & Papas’ 30-year history. It will open a combination of standalone stores and shop-in-shops and is developing a fully transactional Chinese website, due to go live next year.
Mamas & Papas will launch in the country in December, taking a 3,229 sq ft concession in one of Shanghai’s largest department stores, Nanjinulu Baodaxiang.
The move will heap pressure on struggling rival Mothercare.
The news comes as US giant The Children’s Place gears up to take on Mothercare in the Middle East, its second biggest territory outside the UK.
Accelerating international expansion is a key plank in Mothercare’s turnaround plan with new chief executive Simon Calver identifying China, where it has 22 stores, as a “significant opportunity”. Mothercare aims to add between 50 and 80 stores per year to the Asia Pacific region to help halt falling group profits.
Mamas & Papas deputy chief executive Tim Maule told Retail Week: “Mothercare is our obvious competitor there, along with its franchise partner Good Baby, which also runs local Chinese brands.”
Seymour Pierce analyst Freddie George said the move could spell trouble for Mothercare. He said: “If it’s not careful it could lose its fantastic position overseas where it has had little competition [from Western brands]. Much like the UK, someone will come in and do it better.”
China is the latest step in Mamas & Papas’ aggressive international expansion programme. During 2012 it has debuted in Russia, South Africa and Lebanon.
Maule believes the maternity retailer’s international business will be bigger than its UK arm in the next two to three years.
He added he is confident the Mamas & Papas offer will resonate because of the brand’s popularity with Chinese tourists visiting its London stores. He said: “There is a growing middle class in China that wants to buy Western brands. It’s essential that we’re there.”
The retailer has already employed Chinese speakers in its Regent Street flagship to deal with the influx of tourists visiting the shop.
DUBAI, United Arab Emirates & CALABASAS HILLS, Calif.–(Business Wire)–
The leading casual dining restaurant in the U.S.A., The Cheesecake Factory,
makes its much-anticipated international debut at The Dubai Mall, opening under
a license agreement with Alshaya Trading Co., W.L.L. on August 16, 2012. This
opening marks the first location for the brand outside of the United States. The
restaurant, occupying 13,851 square feet with 300 seats, is located opposite the
Dubai Aquarium and is open daily for lunch and dinner.
“For nearly 35 years, The Cheesecake Factory has been the benchmark for menu
innovation, food quality, ambiance and hospitality. Our reputation and brand
awareness are far-reaching, and we look forward to the expansion of The
Cheesecake Factory throughout the Middle East and globally. The restaurant in
the Dubai Mall is in a premier location with a view of the Aquarium that is
quite impressive,” said David Overton, Chairman and Chief Executive Officer of
The Cheesecake Factory Incorporated.
“In keeping with our high standards, menu items will be made in-house, to order,
using only the freshest of ingredients. The menu will also offer our full line
of award-winning desserts, including over 30 varieties of cheesecakes and other
baked desserts made by our bakery production facilities in the U.S. to ensure
quality and consistency. Guests will experience fantastic food served in an
upscale ambiance within a casual setting,” concluded Overton.
Alshaya`s exclusive licensing agreement with The Cheesecake Factory provides for
the development of its restaurants across the United Arab Emirates, Kuwait,
Bahrain, Qatar and the Kingdom of Saudi Arabia. The agreement also gives Alshaya
the opportunity to expand The Cheesecake Factory into its other operating
markets in the Middle East and North Africa, Russia, Turkey and Europe.
“The Cheesecake Factory is a fantastic addition to our restaurant portfolio and
is certain to be hugely popular with the people of Dubai, who will appreciate
the great food, wonderful service and inviting atmosphere that has made this
restaurant renowned the world over. There is incredible demand for The
Cheesecake Factory and we are excited to partner with such an iconic brand. We
already charted out an extensive expansion plan and are looking forward to
continued success with the brand across the Middle East and beyond,” said
Mohammed Alshaya, Executive Chairman of M.H. Alshaya Co.
About The Cheesecake Factory Incorporated
The Cheesecake Factory Incorporated (NASDAQ: CAKE) created the upscale casual
dining segment in 1978 with the introduction of its namesake concept. The
Company operates 173 full-service, casual dining restaurants throughout the
U.S., including 158 restaurants under The Cheesecake Factory mark; 14
restaurants under the Grand Lux Cafe mark; and one restaurant under the
RockSugar Pan Asian Kitchen mark. The Company also operates two bakery
production facilities in Calabasas Hills, CA and Rocky Mount, NC that produce
over 70 varieties of quality cheesecakes and other baked products. To learn more
about the Company, please visit http://www.thecheesecakefactory.com and fan us on
Facebook at http://www.facebook.com/TheCheesecakeFactory.
Marks & Spencer has begun equipping sales staff in all full-line stores with iPads, in order to help them sell more stock. The chain said the tablets will give its staff background information on products, and allow them to take orders for out of stock items.
The tablets will also be used by apparel staff to show customers the full product ranges and place orders, while in the wine section, they can be used to order out-of -stock products and provide detailed information about the provenance and qualities of wines.
M&S has begun trialling the iPads in 36 UK stores and in its Paris store, and will look to introduce them at all 350 outlets in the UK that offer general merchandise and food. The company noted: “This is all grounded in the belief that putting greater knowledge into the hands of colleagues helps them serve the customers better. Making ordering easier is also valuable.”
NamNews – Friday 17th August 2012
Shares in JJB Sports plunged nearly a quarter to an all-time low after a key US investor said it had written off a £20m cash injection after just four months, prompting speculation the embattled Wigan-based retailer could be heading for administration.
JJB’s shares fell 23.7 per cent to just 3.3p yesterday. The slide left JJB with a market value of just £12.7m.
Dick’s Sporting Goods, a US retailer, said it had written off the £20m investment it made in April because of JJB’s recent poor performance, adding that it had no further funding obligations to the chain.
Analysts said the news does not bode well for a funding call JJB made last month after its turnaround hopes were derailed by lacklustre summer trading as poor weather and England’s early exit from Euro 2012 hit sales.
Matt Piner, a consultant at retail analyst Conlumino, said: “I don’t think we will see anyone else putting in serious investment at this stage.”
He added: “There are rumours that JJB will look to go private, which I believe is by far its best hope for survival.
“We could well see it go into administration and then bought out by a private investor.
“JJB has struggled in the glare of the City and going private would give it the breathing space to take a longer-term view.”
JJB earmarked Dicks’ £20m investment for the refurbishment of 60 of its most important sites after trials of a new store format produced much-improved sales and margins.
But last month it started talks with “strategic partners” about sourcing funds that it had thought would not be required until early next year.
Earlier this month, there were reports that fund manager Invesco, which owns 47 per cent of JJB, had lost patience with the embattled chain and wanted to buy its outstanding debt from Lloyds Banking Group, so that it was in a better position to make changes.
At the weekend, private equity tycoon Jon Moulton, through his Better Capital acquisition firm, was reported to have approached JJB and Lloyds with an offer to buy the retailer’s debt, in a move which would effectively hand him control of the company.
JJB has seen an overhaul of its top team in recent weeks, with Beverley Williams, the former boss of lingerie chain La Senza, appointed as interim chief executive to replace Keith Jones.
Turnaround specialist Bob Corliss, who previously ran The Athlete’s Foot, a franchise-based footwear business, joined as deputy chairman in July and will succeed Mike McTighe as chairman in September.
JJB, which trades from 180 stores and employs 4,000 people, has been hit by competition from rivals such as Newcastle United owner Mike Ashley’s Sports Direct International.
Last year, JJB was forced to secure £96.5m in funds from major shareholders and announced plans to close 43 unprofitable stores and place a further 46 on review in a bid to stave off administration.
Fashion and lifestyle retailer Iconic has opened its doors in Dubai Mall as part of major expansion drive, said a press statement.
Inaugurated by Micky Jagtiani, Chairman, and Renuka Jagtiani, Vice Chairperson of Landmark Group, along with Raza Beig, CEO, Splash & Iconic, and Nisha Jagtiani, General Manager, the opening ceremony was attended by customers, guests and valued partners.
Owned by Dubai-based Landmark Group, around 12 stores of iconic will be opened in 2012-13, its CEO Raza Beig said in a recent interview. “For Iconic, we have already signed for 12 outlets but may open a few more. (We) may hire around 250 people for Iconic,” Beig said.
Strengthening the brand’s growing portfolio in the region, the new store is designed on a never before seen format in the Region that focuses on an innovative dimension giving customers a shopping experience that is totally new and exciting.
Speaking at the opening, Raza Beig said: “2012 has been a year of achievements and celebrations at Iconic as our retail footprint gets stronger. Adding Dubai Mall, the region’s most prominent retail destination to our portfolio is a strategic move on the brand’s part. With a new, revised store format stocked with the latest season collection Iconic is bound to attract a multitude of value fashion conscious customers’ locals and tourists alike.”
The store opening was marked amongst much consumer buzz and excitement with funky nail bars, lip tattoos that had women pouting in their best poses, groovy eyelash extension bars and origami balloon artists forming part of the opening festivities. Alongside various activities fashion came alive with the presence of live mannequins who posed with much panache in the hottest trends of the season.
The latest figures from retailer Truworths indicate that the group has misread the fashion trends and lost out to Spanish chain Zara, an analyst said yesterday.
“I think their customers have deserted them to an extent and gone to Zara. Obviously The Foschini Group probably lost a few customers … ultimately everybody loses. But Truworths, being a fast-fashion conscious business, has probably lost a bigger percentage than other people,” Nedbank Securities retail analyst Syd Vianello said.
Zara, owned by Inditex, the world’s biggest fashion retailer, opened its doors in SA late last year. UK fashion brands Topshop and Topman are due to set up shop in SA in November.
“Zara has just two stores, but every competitor is a competitor. It’s opening a third store in Cape Town. Every new store takes another slug of turnover out of the market. Topshop won’t settle with just one store and their price points are going to be competitive,” Mr Vianello said.
Truworths CEO Michael Mark seems to have taken the advent of international retailers in his stride.
“They don’t arrive with hundreds of stores in one day; they come over time and then it’s just part of the competitive landscape,” he said.
The company, which sells Truworths, Daniel Hechter, LTD and Ginger Mary clothing lines, reported a 16% rise in full-year profit in what it described as a highly competitive and challenging retail environment.
Truworths said diluted headline earnings per share were at 517.1c for the 53 weeks to June, from 447.5c.
“Retail sales increased by 12.7% to R9.1bn while comparable store retail sales grew by 8.4%,” it said.
The company’s Identity brand came to the rescue again — turnover increased 25% to R1.4bn.
According to Mr Vianello, the group’s results were “poor”.
“At the end of the day the earnings growth came from pushing the credit and collecting interest income on the book. Trading profit before interest income is only up 6% on a 52-week basis. Relative to what the company has delivered in the past, there are clearly some issues. You can’t carry on pushing credit forever and ever,” he noted.
Credit sales accounted for 73% of the company’s retail sales, from 71% last year. Net bad debt as a percentage of gross trade receivables moved from 6.8% to 7.9%, with the doubtful debt allowance increasing from 10.1% to 10.6%.
Mr Vianello said Truworths had been the most successful fashion retailer in SA by far, with the best margins, and seemingly nothing had ever gone bad for them. “What these results prove is that nobody is infallible,” he said.
Mr Mark said generally subdued economic growth was expected in the months ahead
NEW YORK — Walmart’s second-quarter net income rose 5.7 percent as the world’s largest retailer wooed back frugal shoppers by doubling down on low prices.
The discounter also is raising its full-year profit outlook.
But quarterly revenue that came in short of expectations disappointed investors, who sent the company’s stock down 3 percent to $71.99 in premarket trading.
Walmart’s (WMT) results are considered a bellwether of consumer spending because the company draws nearly 10 percent of nonautomotive retail spending in the U.S. The latest report card from the discounter shows that low-income shoppers are willing to buy — if it’s at rock-bottom prices.
Walmart has had to work hard to get shoppers back. The business had been struggling as its core low-income customers were hard hit by joblessness and other challenges in the down economy. Adding to that, Walmart’s U.S. stores, which account for 60 percent of the company’s revenue, had made some mistakes by veering away from its “everyday low prices” strategy and getting rid of popular merchandise.
But Walmart last year began adding back 10,000 products and refocused on keeping prices low throughout the store. As a result, revenue at Walmart’s U.S. division rose 3.8 percent to $67.35 billion.
Revenue at stores open at least a year — considered a key measure of a retailer’s health because it excludes the impact from stores that open and close during the year — rose 2.2 percent in the division, excluding fuel. The figure, which beat the 2.1 percent Wall Street estimate, marks the fourth consecutive quarterly gain for the division after nine straight quarters of declines.
For the overall U.S. business, revenue at stores opened at least a year rose 2.5 percent, including a 4.7 percent increase at the company Sam’s Club warehouses.
“Given continuing economic pressures, we believe that our price leadership and value are growing in importance to customers across income levels,” Mike Duke, Walmart’s president and CEO, said in a statement.
Walmart’s international business, which produces more than a quarter of its revenue, has remained strong, but the company is striving to make it more profitable. Walmart is focusing on improving its business in Brazil and China. The company’s international business increased 6.4 percent to $32.01 billion in the quarter.
The company reported net income of $4.02 billion, or $1.19 per share, for the quarter ended July 31. That compares with $3.80 billion, or $1.09 per share, a year ago.
Revenue excluding membership fees at Sam’s Club rose 4.5 percent to $113.53 billion.
Analysts had expected earnings of $1.17 per share on revenue of $114.63 billion.
The company said it expects third-quarter net income between $1.04 per share and $1.09 per share. Analysts had expected $1.05. For the full year, the company now expects earnings per share to be in the range of $4.83 to $4.93. That compares with its original forecast of $4.72 to $4.92 per share. Analysts had expected $4.93.
The company continues to deal with allegations of bribery in its Mexico operations, which surfaced in late April and could threaten momentum in its international business, Walmart’s fastest-growing division. The company has launched its own internal investigation into the matter and is working with government officials in the U.S. and Mexico. At the company’s annual meeting in June, company officials pledged that they will get to the bottom of the allegations. Walmart has also been overhauling its compliance program.
Teen clothing retailer Abercrombie & Fitch Co said on Wednesday the pace of declines in its sales has slowed this month as it reported a quarterly profit that slightly topped its recent limp forecast, driving shares up more than 10 percent.
Abercrombie reported that sales at stores open at least a year fell 10 percent during its fiscal second quarter and said it froze plans for new international flagship stores and will slow the build-up of merchandise inventory.
Chief Executive Mike Jeffries told a conference call that while the company still expects same-store sales to fall during the second half, the pace has slowed so far this quarter, pointing to “at least a stabilization” after a disastrous quarter that saw profit fall by half.
Inventory will rise at a slower clip than sales for the rest of the year, he said. Abercrombie has had to severely mark down unsold merchandise this year, decimating its profits.
The chain has lost shoppers to American Eagle Outfitters Inc, Aeropostale Inc and Gap Inc in the last year and struggled to offer compelling merchandise amid disappointing sales at its international flagships, meant to anchor an ambitious overseas expansion.
Despite some encouraging signs, the company still faces competition heading into the holiday season.
“The brand is losing share within the teen space to American Eagle Outfitters, which has done a better job with fashion,” Nomura analyst Paul Lejuez said in a research note.
Jeffries said the company has put new flagship undertakings on hold and was scaling back projects stores in Dublin and Seoul to a smaller scale.
“Cannibalization has clearly been a factor as our brands have become more widely available in Europe,” Jeffries said, pointing to the London Abercrombie & Fitch flagship, which has been devastated by Europe’s slow economy and the chain’s expansion.
Same-store sales at the company’s international stores fell 26 percent in the second quarter that ended July 28.
In Europe, Abercrombie has had to compete with Sweden’s H&M, the world’s second-largest fashion retailer, whose sales grew in July for a third straight month. H& M generates most of its sal es in Europe.
Jeffries said Abercrombie was increasing its sourcing from the United States and Central America, which are typically more expensive than Asia, to shorten the time between placing orders and getting clothes into stores, in a bid to compete with “fast fashion” retailers like H&M.
Abercrombie shares rose 10 percent to $35.56 in late morning trading, but remain well below the 52-week high of $77.47 hit last October.
MAY BUY BACK MORE SHARES
The company earned $15.5 million, or 19 cents per share, in the second quarter ended July 28, down from $32 million, or 35 cents per share, a year earlier.
Two weeks ago, it forecast profit of 15 cents to 18 cents per share, roughly half of what analysts estimated at the time. It also slashed its full-year profit forecast.
Quarterly sales rose 4 percent to $951.4 million, largely because of an increase in stores.
Sales at stores open at least a year, or same-store sales, dropped 11 percent for the flagship Abercrombie & Fitch stores, 10 percent for abercrombie kids, and 10 percent for Hollister, the company’s largest brand by sales.
For the year, Abercrombie reiterated its Aug. 1 forecast of earnings of $2.50 to $2.75 per share. It sees same-store sales falling 10 percent in the second half, which will include the back-to-school and holiday seasons – the two busiest periods for clothing chains.
Abercrombie is raising its share buyback authorization by 10 million shares to 22.9 million, just over one-quarter of its outstanding shares. Analysts had expected the move, which could in theory boost the share price.
Finance chief Jonathan Ramsden said the company, which did not buy back any shares in the second quarter, would wait for sales trends to stabilize before repurchasing any stock.
(CBS/AP) NEW YORK – Gap Inc. (GPS) is reporting a 29 percent increase in second-quarter net income as the fashion retailer’s moves to spice up its fashions are attracting shoppers back to its stores.
Gap, which operates stores under its namesake, Old Navy, Banana Republic and Athleta, also said Thursday that it’s raising its full-year profit guidance.
The San Francisco-based retailer earned $243 million, or 49 cents per share, for the three months ended July 28. That compares with $189 million, or 35 cents per share, in the year-ago period.
Retailers report better-than-expected July revenue
Retail sales gain boosts Wall Street
J.C. Penney struggles with change
Revenue rose 6 percent to $3.58 billion. Revenue at stores opened at least a year was up 4 percent.
“Customers responded well to our product offerings across our brands, driving a healthy increase in sales and earnings per share during the quarter,” said Gap chief executive Glenn Murphy in a statement. “Our continued focus on product and store execution are helping to drive positive momentum, and we’re committed to sustaining solid performance for the remainder of the year.”
Analysts expected a profit of 46 cents per share on revenue of $3.57 billion, according to FactSet.
The Gap is also benefiting from a recent hike in consumer spending. Retail sales rose rose 0.8 percent from June to July, the Commerce Department said this week. It was the sharpest increase since February.
Jumeirah Restaurants, a unit of the Jumeirah Group, said on Tuesday it has signed a licence agreement to open outlets in Bahrain.
The deal with Bahrain-based company Delightful Foods will see three Noodle House restaurants open, the first of which will open in Seef Mall later this month.
Delightful Foods is a joint venture between Jasmi’s Corporation and Divine Foods, a statement said.
The company is also the licensee for Tony Roma’s in Bahrain and operates seven self-developed brands, including Le Chocolat, Jasmi’s Coffee, Dajajio Chicken, Wood and Bella Napoli pizzeria.
The signing in Bahrain extends The Noodle House presence to eight countries, with new restaurants opening in Russia, Morocco and the UK in the coming months.
Phil Broad, managing director of Jumeirah Restaurants, said: “With a successful presence in seven countries, the power of the Noodle House is surpassing anything we ever expected.
“This is a really exciting time for the Noodle House and we are committed to capitalising on the global interest surrounding the brand to extend its global footprint.
“Our current focus for this is the US, China, and Mainland Europe markets. That being said, the UAE and the Middle East still remain a key focus for us and we believe that there are still a lot of opportunities to be had across the region.”
Drawing its inspiration from the streets of South-East Asian cities such as Hong Kong, Shanghai, Bangkok and Jakarta, the Noodle House has seen major expansion since the first restaurant opened at Jumeirah Emirates Towers in 2002.
Hennes & Mauritz, the world’s second-largest fashion retailer, said sales grew for a third straight month in July, despite gloom in its biggest market Germany, in a sign of robust demand for budget clothes from austerity-hit shoppers.
The fast-expanding Swedish budget fashion group, which does not comment on its monthly sales data, said on Wednesday sales at stores open a year or more rose 2 percent in local currencies in July, compared with a forecast for 2.7 percent.
Total sales, including newly opened stores, were up 11 percent, against a forecast for 12.4 percent.
H&M, which trails Zara owner Inditex by most measures, has weathered the downturn relatively well as shoppers focus on cheap fashion.
H&M, present in 44 countries and expanding in emerging markets, has the bulk of its business in Europe. In Germany, clothing sales overall shrank for a fourth straight month in July, declining 3 percent, according to industry publication Textilwirtschaft.
“In light of market data … this shows H&M is doing relatively well,” Nordea analyst Stefan Stjernholm said.
“Looking at H&M this year, we know it is a really tough market. Given that, I think H&M has delivered a good sales development overall.”
H&M shares were down 0.2 percent at 0800 GMT, with a European retail index down 0.4 percent.
Sydbank analyst Nicolaj Jeppesen said Europe may well have dragged on sales in July, with the increase coming on the back of growth in North America.
“Consumer confidence and the general market sentiment (in Europe) is quite weak and we expect that to continue. So, we need to see that they can increase sales in North America and improve their position in Asia,” he said.
July is the second month of H&M’s fiscal third quarter. In June, like-for-like sales were up 3 percent, and total sales 13 percent ahead. In the first half of the year, like-for-like sales were up 3 percent, and total sales 12 percent.
Beside overall market weakness, analysts worry about the longer term effect of the weak euro on H&M, which buys the bulk of its goods in dollars, has Europe as its biggest market and translates its profit into the strong Swedish crown.
The crown is near a 12-year high against the euro, which has also lost ground against the dollar.
H&M said it had a total 2,603 stores at the end of July, matching its target of growing its number of stores by 10-15 percent annually.
Apparel company Michael Kors Holdings Ltd reported higher-than-expected quarterly profit, helped by rising sales at its own stores and the roll-out of its boutiques at department stores, and raised its full-year profit forecast.
Michael Kors, whose founder is a judge on the long-running television fashion show “Project Runway,” said on Tuesday sales at its own stores open a year could rise as much as 30 percent this quarter.
Total revenue in the first quarter soared 70.6 percent to $414.9 million.
Net income increased to $68.6 million, or 34 cents per share for the quarter ended June 30, from $24.1 million, or 13 cents per share, a year earlier. Analysts expected 20 cents per share, according to Thomson Reuters I/B/E/S.
Michael Kors expects second-quarter same-store sales to be up 30 percent, with a profit of 33 cents to 35 cents per share.
For the full year, it sees total revenue in the range of $1.8 billion to $1.9 billion. The company expects earnings of $1.32 to $1.34 per share for the year, compared with an earlier forecast of $1.08 to $1.12.
Wednesday, 15 August 2012
DOHA: Gulf Warehousing Company (GWC), Qatar’s leading logistics company, has been awarded a contract by Spinneys Qatar, one of the leading retail hypermarket chains spreading throughout the Gulf.
Under this contract, GWC will be responsible for all warehousing and distribution of temperature-controlled, chilled and frozen storage of Spinneys products to various outlets in Qatar. GWC will also handle the reverse logistics from outlets in addition to services such as pick, pack, and inventory management.
The processes will be managed using GWC’s state-of-the-art technology platform, specifically the Warehouse Management System (WMS), which controls all warehouse activities. The system will enable GWC to manage the entire supply chain and seamlessly connect all inbound and outbound logistics while enabling efficient monitoring of inventory and order fulfillment.
GWC will allocate an area dedicated to Spinneys operations in one of its multi-user Cold Chain Distribution Centers. This contract further heightens GWC’s presence within the Consumer and Retail sector and demonstrates the logistics provider’s ability to offer integrated solutions to its customers.
Ranjeev Menon, Group CEO of GWC, stated “We are delighted with the signing of this new contract. The confidence that Spinneys has placed in GWC is proof of excellence in the solutions we provide for this sector and we always strive to deliver impeccable service.”
Elias Tabet, Country Manager of Spinneys Qatar said: “We have chosen GWC as our logistics partner as it has an award winning, modern logistics infrastructure coupled with a personalized and highly flexible service. Spinneys has aggressive expansion plans into more outlets for which we will require a dependable and scalable logistics backbone. With GWC, we are assured of an efficient and reliable solution”.
It employs 180 people in Scotland, mostly at Barrie Knitwear in Hawick.
Dawson has been struggling with a large deficit in its pension scheme and directors of the firm have criticised the pensions regulator for failing to agree a rescue package.
It is understood the company is continuing to trade as normal for the moment and its US import business is not affected by this move.
Last month the company’s shares plunged after it announced that the pensions regulator and the Pension Protection Fund (PPF) had rejected its attempt to put its pension plans into a protection fund.
It warned then that it may have to appoint administrators if the talks fail.
Administrators at KPMG, said the firm collapsed with a pension debt of £129m. That was the amount outstanding after the PPF refused to take on the liability.
When pension trustees presented the bill for payment by 19 August, directors concluded they could not pay it.
Joint administrator Blair Nimmo said the cashmere specialist sold £9.7m in produce last year, exporting 90% of it, and making a pre-tax profit of £1.1m.
He invited potential buyers to contact him, saying Barrie has more than 100 years of trading history, a portfolio of recognised brand names, including Barrie, Glenmac, John Laing and Kinross, and a worldwide customer base.
Barrie Mill in Hawick makes cashmere garments, mainly for other luxury retail brands.
David Bolton, chairman of Dawson, said: “This is a sad day for Dawson International, and for British manufacturing.
“To see this 140-year-old company forced into administration due to the PPF’s decision is deplorable, a direct consequence of a flawed process lacking in common sense and transparency.”
Noodle chain Wagamama opens four new sites and looks for 20 more
Wagamama has continued its expansion by securing four new sites across London and the UK. It has taken 5,300 sq ft at the Ealing Broadway Centre, 3,500 sq ft at Telford Southwater, 2,800 sq ft at Fulham Broadway Centre and 3,500 sq ft at Southampton West Quay.
According to Wagamama property director Sharon Cawthorne, the Japanese-inspired restaurant chain is looking to open another 15-20 sites in the next year across the UK. She said:“We continue to work with Cushman & Wakefield and our owners at Duke Street to roll out the brand across some of the leading locations across the UK. Our new openings are trading fantastically well and we are expanding whilst also maintaining our position as an award winning global restaurant chain”