by The Editors on November 3, 2008
We’ve been getting unconfirmed word today regarding recent lay-offs at some of the industry’s biggest brands. Podium Distribution reportedly laid off approximately 20 people on Friday, October 31, 2008. Similar lay-offs were also rumored at Black Box, Osiris, and Sole Tech.
As one action sports worker said, “Retailers can’t sell their stuff. They can’t get credit to buy more product. Companies can’t get credit to produce. . . and the tower tumbles.”
Another worker just toured the California retail scene and said that the story is the same everywhere. “It was really bad during that first weeks of the financial panic,” he said. “I’m pretty sure no one bought anything during those two weeks. It’s going to be interesting to see which brands and retailers make it through this.”
So true. If anyone has any info to share, please leave it in the comments.
by The Editors on November 3, 2008
Plans for a new Chicago Billabong retail store on the city’s State Street have apparently been scrapped according to a story in Chicago Business.
Gourmet grocer Fox & Obel and trendy surf-wear retailer Billabong are dropping plans for stores in the former Carson Pirie Scott & Co. building on State Street, leaving the ambitious project with only one tenant as it approaches an opening next fall amid the bleakest retail climate in decades.
Probably not a bad idea. Are people even shopping any more?
[Link: Chicago Business]
by The Editors on November 3, 2008
And now, from the Australia’s Herald Sun:
Globe International has come under renewed fire from investors, including Solomon Lew, over $57 million in related party transactions. . . . Globe investor and investment banker David Williams — who called for a board spill at the company’s annual meeting last month — has voiced concern about a series of deals involving Globe and companies linked to CEO Matt Hill and his brothers, Peter and Stephen. . . .This raises further speculation about the future of Globe, which has in the past two years sold a number of its brands in a bid to streamline the business.
[Link: Australia Herald Sun]
by The Editors on November 2, 2008
The Orange County Business Journal is reporting that Quiksilver is actively looking for funding to help negotiate what it calls one of the company’s “worst downturns in clothing sales in recent memory.”
Quiksilver has hired Morgan Stanley to help it look at ways to raise money, including from existing lenders, through a stock sale or a possible private equity investment. . .The company reworked a European credit line that was due last Friday. Quiksilver is paying its lender $19 million now and deferring $71 million until March. . . Quiksilver said it expects to have about $100 million in cash and equivalents after the close of the Rossignol sale and debt payments made before the close of the company’s fiscal year that ended Friday.
Sadly, some of the recent rumors regarding the surf giant’s financial future appear to be growing legs.
[Link: Orange County Business Journal]
by The Editors on October 31, 2008
In its original sales announcement in August 2008, Quiksilver was reportedly unloading Rossignol to Chartreuse & Mont Blanc for EU75 million in cash and EUR25 million sellers note (or a total of EUR100 million). But that was in the days before the crash. Now the deal, which is supposed to close “in early November,” looks quite different.
. . . the parties agreed to recast the terms of the sale due to the recent challenges in the global credit markets. The revised transaction reduces the cash payment to Quiksilver upon closing from 75 million to 30 million and reduces the seller’s note from 25 million to 10 million.
So, the price former Rossignol CEO Bruno Cercley is now paying for the company is only EUR40 million. That’s a 60 percent discount after only two months. How’s that for a company for which Quiksilver originally paid $320 million?
[Link: MarketWatch]
by The Editors on October 31, 2008
Citing weak sales of surf and snowboard gear in the UK, O’Neill’s exclusive UK distributor Blacks Leisure has reportedly begun talks to pull out of the deal with the surf company.
The Northampton, England-based company plans to end the O’Neill contract in January, Chief Executive Officer Neil Gillis said today in a telephone interview.
Wonder if that drop in sales had anything to do with the issues surrounding the company’s firing of Darren Spurling back in May?
[Link: Bloomberg]
by The Editors on October 31, 2008
Volcom released it’s third quarter financial results yesterday and despite an economy in turmoil, the company has increased total consolidated revenues by 23 percent. Wooly is pretty happy about it.
Our solid third-quarter performance is testament to the strength of the Volcom brand and our team amid a challenging retail environment,” said Richard Woolcott, Volcom’s chairman and chief executive officer. “Managing our business with discipline, commitment and focus is essential during these times of economic uncertainty, and we strongly believe that our current position as an industry leader and our healthy balance sheet will empower Volcom over the long term.”
We missed the conference call, but if you still want to listen to a replay just call (800) 642-1687 (domestic) or (706) 645-9291 (international) and enter reservation number 69147961. Or, click here for a full transcript of the call.
[Link: Trading Markets]
by The Editors on October 30, 2008
Sales managers know the truth: the midwest is a gold mine. The rest of us are always caught off guard. Today we learned about a new action sports clothing mall store. It’s called Glik’s and it is a 111-year-old family run store that recently opened it’s 53rd location. This one is in Hutcinson, Minnesota.
Glik’s, which carries name brand apparel for young men and women, has seven other Minnesota stores in Alexandria, Detroit Lakes, Grand Rapids, Marshall, Park Rapids, Virginia and Willmar. The company also has stores in Missouri, Illinois, Indiana, Michigan, Iowa and Wisconsin. . . .Among the brands carried by Glik’s are Silver Jeans, Billabong, Hurley, Roxy, Fox, Quiksilver, DC, and Volcom.
Now we know.
[Link: Hutchinson Leader]
by The Editors on October 29, 2008
We’d probably be more embarrassed that anything, but Quiksilver would like everyone to know that several of the stars of MTV’s The Hills enjoy wearing Quiksilver duds on the show.
Doug Reinhart, Brody Jenner and Frankie Delgado are fans of Quiksilver – Fact! . . . Check them rocking Quik on MTV’s hit show “The Hill’s”. Full episodes online here!! . . . Snag your own Quik gear online at Quiksilver.com or stop in a Quiksilver Store near you!
Ah, we’re kind of thinking this might be a great reason not to wear the stuff. Then again if we paid that much money getting our clothing on MTV we’d probably have to pimp it all to hell, too.
[Link: The Mountain And Wave]
by The Editors on October 28, 2008
Derek O’Neill, CEO at Billabong, told investors that the falling Australian dollar is great for company profits, according to a story in The Australian.
There has been a dramatic fall in the value of the Australian dollar, in particular against the US dollar and the euro,” Mr O’Neill said. “After so many years of watching the company’s reported profits eroded by an appreciating Australian dollar, there is now the prospect of strong reported gains from a depreciating Australian dollar.” . . . Every 1c movement from these assumed exchange rates meant a 0.6 per cent change in profit for Billabong, Mr O’Neill said.
And that must make Paul Naude very, very happy.
[Link: The Australian]
