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De Rigo S.p.A. (DER) Message Board

  • eddie_haskel_1 eddie_haskel_1 Oct 1, 2004 10:47 PM Flag

    La svolta di Fendi

    La svolta di Fendi


    Milano, 30 settembre 2004 - Puntare sulla crescita di occhiali e scarpe; rilanciare i profumi a partire dal 2005; inaugurare almeno 15 nuove boutique all'anno nei prossimi tre, incluso un nuovo flagship store nella centralissima Fifth Avenue di New York. � questo - in estrema sintesi - la strategia di rilancio del marchio Fendi delineata dall'amministratore delegato Michael Burke nel corso di un'intervista esclusiva rilasciata al sito Women's Wear Daily durante la presentazione delle collezioni primavera-estate 2005 in corso a Milano.

    �Non desideriamo un successo a breve termine che si sgonfi come un souffle fra un anno�, ha detto Burke. Sul piano pi� strettamente economico, il manager della maison italiana che fa parte del gruppo LVMH di Bernard Arnault punta a raddoppiare il volume d'affari e a raggiungere margini di profitto operativo a due cifre entro, al massimo, quattro anni. Per entrare nel merito, l'ad di Fendi ripone grande fiducia nel potenziamento del settore calzature, che insieme alla pelletteria costituisce il nucleo storico della maison. Di recente acquisizione � il designer italiano Ernesto Esposito, incaricato di ideare la collezione autunno-inverno 2005-2006, anche se la sua cifra stilistica � gi� presente nei modelli presentati quest'anno. Rispetto al settore dell'occhialeria, Burke, prendendo ad esempio la maison Dior (che pure appartiene alla �scuderia� LVMH), ha detto che le due licenze attualmente controllate da Fendi - Marchon per il mercato statunitense e De Rigo per il resto del mondo - saranno ridotte a una, Marchon, a partire dal prossimo anno.

    Un 2005 particolarmente carico di prospettive e di eventi � dunque quello che attende il marchio Fendi. Anche nel campo dei profumi infatti, Burke ha ricordato che l'anno prossimo scadr� la licenza attualmente nelle mani del gruppo concorrente PPR, presieduto da Serge Weinberg. Non occorrer� attendere San Silvestro per vedere annunciate nuove fragranze sotto le insegne LVMH.

    Obiettivi certamente ambiziosi, per centrare i quali non potr� mancare l'apporto di uno stilista di valore assoluto come Karl Lagerfeld - che disegna per Fendi la collezione di pellicceria e il pr�t-�-porter. Lo stilista aveva per� espresso giudizi poco lusinghieri nei confronti del management Fendi. �Pi� di due decenni fa Karl ha reinventato il ruolo della pelliccia. � un grande innovatore ed � perfetto nel suo ruolo�, ha tagliato corto Burke.

    Il settore in cui forse si preparano i cambiamenti pi� radicali � per� quello distributivo. La casa di moda romana non pu� infatti attualmente contare su una rete distributiva propria altamente ramificata. La prospettiva delineata dall'amministratore delegato nella lunga intervista concessa a Women's Wear Daily � quella di invertire drasticamente la rotta. La trama distributiva conta oggi 103 punti vendita; saranno 150 entro il 2007. Tra le localit� pi� importanti sotto il profilo commerciale nelle quali saranno aperti nuovi negozi monomarca gi� a partire dal 2005 ci sono Costa Mesa in California, Bellagio a Las Vegas, Osaka, Pechino, Seul e soprattutto Roma. A new York, invece si prepara un trasloco da un marciapiede all'altro. Ceduta infatti ad Abercrombie & Fitch la licenza della boutique sulla Quinta Strada, la griffe delle due effe si prepara a riaprire tra Cartier e Gucci. Inaugurazione prevista per l'autunno del prossimo anno. Promesso un totale rinnovamento dello stile degli arredi e delle ambientazioni. Insomma, dire che tirer� aria nuova in casa Fendi � dire troppo poco. Sar� un vero e proprio ciclone. Il ciclone Michael.

    Nella foto, Michael Burke, amministratore delegato di Fendi

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    • Eddie,

      You really know your stuff. It's rare - real rare - to find anyone on these boards who knows anything about stock analysis. My hat's off to the one who knows what he's talking about by digging. Soon as I make my next deposit I will be a stockholder.

      P.S. Feel free to post your other picks, because I'd be happy to look them over.

      Sincerely

      Dean Paton

    • "Recentemente De Rigo ha fatto richiesta di �dual listing� a Borsa Italia e dovrebbe entro alcuni mesi essere quotata sul nostro listino. La diretta contrapposizione con Luxottica (14 euro), potrebbe avvicinarne i multipli."

      http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=1600640687&tid=der&s
      id=1600640687&mid=180


      Keep in mind a dual listing on the Milan exchange is supposed to take place. Not long ago on CNBC I saw an interview (trend investing) with a money manager who has been investing in companies in far east that list the company common on another exchange in this case it was Hong Kong. When a dual listing occured i believe he said it would cause greater liquidity and he would see immediate impact on stock price. De Rigo has not made a public statement that it was going to list on Milan exchange (at least I have not seen one) so we can't rely on what we read or what they tell you on phone until it actually happens.

      Be interesting to see what develops. One thing to note is volume is very low. IMO there probably is less than 15M shares in retail hands. Between the bellunese brothers and Institutions you would think this company was going private. But if they dual list then privacy would not be an issue??

      http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=1600640687&tid=der&s
      id=1600640687&mid=136

    • A couple of months ago DER bought back Prada shares for 6.30. Prada bought same shares a few years back for about 8+ dollars.

      DER management owns at least 77% of DER common stock. I don't believe PFDS were issued. I believe options can fully be excercised if stock reaches $10.00 level.

      CEO has used SARS, Iraq war and weak dollar as reasons for poor performance in the past. I believe wholesale and USA market is going to be a challenge.

      As far as Italian imports to USA is concerned, I have seen INFLATION!! Everything imported from Italy has gone up due to the week dollar. I would be curious to see what would happen to bottom line if dollar begins to strengthen a bit. Exchange rates is not my expertise.

    • MILAN -- In a move to conquer more of the luxury market, Italian eyewear manufacturer De Rigo has announced a strategic alliance with LVMH Moet Hennessy Louis Vuitton to develop and distribute eyewear for the French fashion group.

      A statement from De Rigo said the agreement would also give LVMH the chance to acquire up to 5 percent of De Rigo's equity from controlling family members by the end of this year. The De Rigo family has a 77 percent stake in the company; the remaining shares are traded on the New York Stock Exchange.

      "This is another step for us to increase our luxury brand portfolio," said Maurizio Dessolis, chief financial officer for De Rigo. "Our strategy over the past two years has been to move away from mass market products and focus on building premium brands."

      An LVMH spokeswoman confirmed the agreement, but would not elaborate.

      As reported in these columns, LVMH was said to have already bought the De Rigo shares for a total of $16.7 million in December. But Dessolis said De Rigo and LVMH signed the deal this week and that LVMH had yet to exercise its option to buy.

      Dessolis said the cost of the 5 percent stake in De Rigo would be based on the market price of the shares and on the number of licenses granted by LVMH.

      De Rigo already manufactures eyewear under license for Givenchy, Celine and Loewe, and Dessolis said it would like to add more LVMH brands -- specifically Christian Dior -- to its stable.

      "Clearly we are strongly interested in the Dior license, but that is another deal entirely, and something we will have to wait for," he said.

      Dior's current eyewear contract is with Italy's Safilo, and is set to expire in 2002. Both Safilo and LVMH declined to comment on the future of that license.

      The LVMH agreement is De Rigo's second alliance with a luxury goods group.

      In March 1999, De Rigo formed a joint venture with Prada to manufacture, market and distribute eyewear for Prada and Prada Group brands Miu Miu and Helmut Lang.

      De Rigo also makes Sting, Fila and Police eyewear. In 2000, De Rigo reported sales of $403.8 million, up 42 percent from 1999.

    • Keep in mind this particular article is from year 2002.

    • I hope you are beginning to get the picture. This is a turn around play.

      Take a look at the DA stores per SEC filings now. Same store sales are up. Economy is also doing well in Spain where they own chain of stores.

      MILAN -- Italian eyewear maker De Rigo saw its first-half profit drop on weakness at its U.K. retail unit Dollond & Aitchison, but competitor Safilo fared better in terms of sales and profitability.

      De Rigo's net profit for the six months ended June 30 fell 31.4 percent to $9.2 million from $13.41 million in the comparable 2001 period, hurt mostly by poor results at D&A. Margins at the unit suffered as a result of weak eyewear sales in the U.K., as well as delays and logistical problems stemming from a reorganization of its lens production, De Rigo said. On an operating level, De Rigo's first-half operating profit dropped 16.8 percent to $18.4 million from $22.1 million.

      De Rigo saw its first-half sales rise 1.7 percent to $268.2 from $263.7 million. The company did not break down sales for each unit but it said retail sales at its Spanish chain General Optica rose 14.7 percent while D&A's retail sales fell 3.9 percent.

      Safilo saw its net profit for the same period rise 18 percent to $47.5 million from $40.2 million. But the firm, which recently became private by delisting its shares from the Milan stock exchange, did not explain the boost in profit. Safilo's operating profit rose 10 percent to $85.5 million.

      Safilo also outpaced De Rigo's sales growth. Safilo saw its volume rise 5 percent to $499.5 million. It didn't provide a detailed geographic breakdown, although the company said sales in France rose 13 percent.

      De Rigo also said it suffered in part from weaker sales and margins at International Eyewear Distribution, its joint venture with Prada. Revenue dropped 25.4 percent to $14.7 million from $19.7 million as EID sold more eyewear to lower-priced independent retailers than in the past. Unit sales rose 11.1 percent.

      The Prada venture's profitability should improve as it cuts costs, De Rigo said. In the first half, EID's operating profit came in "close to breakeven" compared with a profit of $782,848 in the first half of 2001.

      In other news, Safilo has opened the doors of a showroom on Paris's Champs Elysees. This store, Safilo's second in France, will sell the various eyewear lines Safilo produces, including Gucci, Polo Ralph Lauren and Christian Dior.

      Meanwhile, De Rigo said it has signed a licensing agreement to produce and distribute Furla eyewear. The company said it plans to launch the first Furla sunglass collection by the end of this year. Chief financial officer Maurizio Dessolis declined to specify the value of the contract but he said the license should generate "consistent volume" in sales.

    • In 2002, EID sales reached $35.8 million, down 2.8 percent from the previous year, with an operating loss of $1 million.

      After lackluster results with De Rigo, Prada is hoping its new partner will fully realize the potential of its eyewear business. "I am certain that the strong technological, industrial and distributive capabilities of Luxottica Group will pave the way to achieve significant economic results in a short amount of time," Patrizio Bertelli, chief executive of Prada Group, said in a statement.

      A source close to De Rigo said the public company decided to sell its stake in EID because it wasn't satisfied with its evolution.

      "Really, both parties were unhappy with the setup," the source said. "The major part of the management was handled by Prada and De Rigo never had direct control over the business. It was useless for De Rigo to continue with the venture."

      Although De Rigo will no longer be involved in the distribution of Prada's eyewear collections, it will continue to produce a nominal part of Prada's eyewear. According to the statement, Luxottica "has the option to rely on third-party manufacturers under its own supervision" and a Prada spokesman confirmed that De Rigo would continue to produce a "very, very small" amount of eyewear for the Prada brand. The spokesman reiterated that Luxottica would oversee any outsourced production.

      While the Luxottica deal covers both the Prada and Miu Miu labels, it's not yet clear what firm or firms will produce eyewear for Helmut Lang and Jil Sander. "We are currently in discussions," a Prada spokesman said. "When something is finalized we will communicate it."

    • PRADA ENDS DE RIGO EYEWEAR VENTURE, SIGNS 10-YEAR LICENSE WITH LUXOTTICA.


      Courtney Colavita

      Full Text: COPYRIGHT 2003 Fairchild Publications, Inc.
      MILAN -- In the latest shakeup in the Italian eyewear industry, Prada has ended its four-year joint venture with De Rigo and signed on with industry giant Luxottica Group.

      Prada bought out De Rigo's 51 percent stake in their joint venture company, EID (International Eyewear Distribution), and subsequently sold 100 percent of it to Luxottica for $30.4 million or, in local currency, 26.5 million euros.

      Under the 10-year licensing agreement, Luxottica will produce eyewear for both the Prada and Miu Miu brands, as well as manage worldwide distribution.

      In a joint statement, Luxottica said it expects the Prada license to generate sales of $137.7 million, or 120 million euros, in the first year of the contract. The first collection to be produced by Luxottica is set to bow in September.

      Over the past few months Luxottica has sought to fill the vacancy left by the termination of the Giorgio Armani eyewear license. In January it inked a licensing deal with Versace, just months after Armani ended its 14-year relationship with the luxury eyewear manufacturer. Although the Versace license was a strong first step in rebuilding Luxottica's revenues, its expected first-year sales of $103.4 million would still fall far short of what the Armani license brought in. In 2001, Armani eyewear accounted for more than $250 million in revenues, about 7.2 percent of Luxottica's sales of $3.52 billion. Dollar figures have been converted from the euro at current exchange.

      However, with Prada now in its portfolio, Luxottica is one step closer to generating designer and luxury revenues commensurate with those of the past, despite its inability to generate breakthrough sales under the EID banner.

      "With this new license -- and others we have recently signed -- we have restored the importance that designer lines had for us in 2002," Leonardo Del Vecchio, chairman of Luxottica Group, said in a statement.

      The firm, however, warned the Prada license would not have a "significant impact" on its 2003 financial performance.

      Formed in 1999, EID produced and distributed eyewear for Prada Group brands, including Miu Miu, Jil Sander and Helmut Lang. Although there was much fanfare behind the deal, the joint venture never quite took off and recently started to incur losses.

    • Silhouette's Fay and Orentas see a trend toward sheer, lightweight fabrics, at times in multiple layers.


      "This trend is also apparent in jewelry designs where beautiful semi-transparent stones and crystals combine with metal accents to create exquisite looks," Fay said. "Color is everywhere and the rules are out the window, mixing bright exotic colors with more muted, natural ones."

    • "Previously, magnetic clips could fall off if you moved too fast or turned too quickly," he said. Safilo's system "ensures a sure-fit locking grip that moves with the active individual all day long."

      He also described two "high-strength engineered plastics," Trogomide and Grilimide, that offer superior strength and thin profiles.

      "Bright colors look great in these thin profiles because the color looks rich and expressive without looking too bold. Safilo's Giorgio Armani collection offers this innovative material," he said.

      Silhouette

      Silhouette Optical Ltd.'s Fay and Orentas said several technologies have highly influenced their product lines-the screwless mounting system and the hingeless temple.

      Silhouette's screwless mounting system was developed for the very successful rimless collections and was the first in the industry to use a pressure mount, Orentas said.

      "The SPX sleeve allows for absolutely no metal to touch the lens, resulting in a secure fit with less breakage," Orentas said. This nearly invisible mounting system allows the frame design to take center stage, eliminating bulky, unstable screws.

      "The technically advanced mounting system is virtually maintenance free, dependable, and reliable for the wearer and dispenser," Orentas said.

      Enlarge 200%
      Enlarge 400%

      [Photograph]
      Top: Eyewear is the largest consumer application for Flexon metal. (Photo courtesy of Marchon) Bottom: The hingeless temple allows a graceful, lightweight, and minimalist design. (Photo courtesy of Silhouette)


      This mounting system can be found in several of Silhouette's collections, including the Titan Minimal Art, Minimal X, and the new Adidas rimless collection, Performance 3-stripe.

      Adding the hingeless (screwless) temple to allow a graceful, lightweight, and minimalist temple is another important technical development that Orentas discussed. This technology is available in rimless, semi-rim, and full-rim metal collections, all in the lightweight and pliable beta-titanium.

      The development of Silhouette's patented synthetic material, SPXng, has allowed the company to offer the screwless, hingeless design in plastic in the Minimal X collection.

      Fashion trends

      The fashion aspect of the frame business has grown over the years, resulting in a "star-like" popularity, according to Orentas. Each year, as the fashion runways are filled with the coming season's fashion trends, eyewear is being included. The optical manufacturers' design teams pay close attention to the trends, color, and weight of materials and embellishments that are used.

      "It seems that opposites are strong: rimless and minimal or plastics in bold shapes and colors," said Marchon's Rollins. "Consumers want their eyewear to be either invisible or bold and make a statement.

      "We think designer brands will continue to be as important as technology in the future," she added.

      Safilo's Duralde believes color is an important part of the current fashions.

      "Color, color, and more color continues to be the message in fashion and eyewear is part of this explosion of color. Pink, purple, and burgundy are popular color choices for women. Also, we are seeing the emergence of turquoise, coral pinks, yellows, and greens as the next accent colors for the coming seasons," he said.

      Look to the Emporio Armani collection for use of color in an expressive way, Duralde added.

      "The consumer is willing to pay more if the frame has details or styling that command a higher price. These details include decorative stones, innovative logos that express the brand message and polarized lenses for sunglasses," he said.

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