US: Fifth & Pacific cuts FY outlook on Juicy Couture
US fashion firm Fifth & Pacific has lowered its full-year profit target after struggling to sell enough of its Juicy Couture products at full-price.
The company now expects full-year EBITDA to be in the range of US$100m to $115m, compared to previous guidance of $125m to $140m.
"While two of the brands continue to perform well, as we now have visibility as to comparable sales and margins for the third quarter at Juicy Couture, we are not seeing the improved results we were forecasting for Juicy and are not expecting Juicy to achieve its forecasted results in the fourth quarter," explained CEO William McComb.
The company is taking a number of steps to address the problem, including delivering more products to higher performing doors, moving excess inventory to the outlet channel more quickle, along with new merchandising and pricing strategies in stores.
Looking forward, McComb added: "We continue to be optimistic about our ability to turn around the Juicy business results and capitalise on its very strong global brand awareness and reputation; in the meantime, Kate Spade's results are powerful and encouraging, and Lucky Brand is continuing to perform well."
During the third quarter, direct-to-consumer comparable sales, including online sales, at Juicy Couture edged down 1%. Meanwhile, Kate Spade and Lucky Brand sales increased 21% and 4% respectively.
Fifth & Pacific has no plans to take the struggling Juicy Couture brand downmarket as part of efforts to turnaround the business, and instead says it will focus on its own stores and productivity....
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