Fashion

Corona Capital: KFC ditches finger lickin’

25 Aug 2020

Concise views on the pandemic’s corporate and financial fallout: The Yum Brands’ fast-food chain made eating fried chicken synonymous with cleaning your digits with your mouth. KFC has at last realized that’s a no-no in a pandemic.

Fashion can bear the costs of virtue cotton

25 Aug 2020

Most of China’s crop comes from the persecuted Uighurs’ home region. Forced labour may taint some of that, but clothes makers do not yet trace their complex supply chains back to the farms. Scrutiny from politicians and investors means careful sourcing makes financial sense.

Corona Capital: “Halo”, Salesforce, Brooks Bros

12 Aug 2020

Concise views on the pandemic’s corporate and financial fallout: Microsoft delays the next chapter of the “Halo” game franchise; Salesforce gets a lockdown bonus with sale of Zoom shares; and Simon Property suits up with a purchase of Brooks Brothers out of bankruptcy.

Uniqlo is well-tailored for an Asia-led recovery

9 Jul 2020

Fast Retailing cut its annual operating profit forecast but the recovery is robust in its top two markets, China and Japan. It underpins a stock rally that has outpaced rivals Inditex and H&M, and justifies a premium valuation. It also dresses up a bumpy overseas expansion.

Boohoo investors sense its strategic straitjacket

8 Jul 2020

The fast fashion retailer’s shares have slumped again, despite a plan to fix its supply chain. The wider issue is that a doubling of UK clothing makers’ pay could halve Boohoo’s EBITDA margins. Other steps – offshoring more production or hiking prices – are problematic too.

Time for Boohoo bosses to put on an ESG hair shirt

6 Jul 2020

The 4 bln pound retailer has been accused of sourcing clothes from UK workshops which don’t pay minimum wage or observe Covid-19 restrictions. Betting that consumers and investors don’t care is old hat. Adding ESG metrics to its bumper bonus plans would make them more palatable.

New L’Oreal boss will put e-commerce above M&A

3 Jul 2020

The $180 bln cosmetics giant is looking for Jean-Paul Agon’s successor as CEO. Buying brands like CeraVe or Urban Decay and selling them globally has added growth. But high valuations raise the relative importance of reaching more consumers with what it has already got.

Corona Capital: Tesla, OPEC

2 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Tesla speeds past its traditional rivals, and OPEC’s next meeting shapes up to be a bruising encounter.

Corona Capital: Frequent fliers, Folies Bergeres

15 Jun 2020

Concise views on the pandemic’s corporate and financial fallout: United Airlines hocks its MileagePlus loyalty program for $5 bln from Goldman; Lagardere tries selling Parisian nightlife venues, including Les Folies Bergeres and Bataclan theatre at perhaps the worst time ever.

Make-up artist’s star power tested by $1 bln tag

4 Jun 2020

That’s how much Puig is close to paying for Charlotte Tilbury’s cosmetics company, Bloomberg reports. Famous friends and e-commerce helped the entrepreneur boost sales. To justify the price, the Spanish perfumer needs to lift margins after Covid-19, without smudging the brand.

Luxury will fly only when travellers do

22 May 2020

Burberry and its fashion rivals face a summer of discontent. European stores are starting to reopen, and more bling is being sold in mainland China. But purchases by tourists won’t rebound for a while. Rising inventory is a sign that the current season is partly lost.

China’s wannabe fashion empire unravels

3 Apr 2020

Two years after agreeing to buy Swiss luxury brand Bally from JAB for $600 mln, Shandong Ruyi has failed to nail down financing. Its large and complex debt structure looks increasingly shaky. Even an HNA-like fire sale for the Lycra and SMCP owner will be tough in these times.

Corona Capital: Cirque du Soleil, Airlines, France

27 Mar 2020

Concise views on the pandemic’s corporate and financial fallout: Cirque du Soleil may leave TPG sunburnt. Airlines get a sweet bailout. And France joins the campaign against dividends.

Review: Fashion is the true villain of “Greed”

13 Mar 2020

Michael Winterbottom’s movie dramatises the life of a textile mogul loosely modelled on Philip Green. The Topshop owner’s love of mega yachts and celebrities make him an easy target for satire. But grim scenes from Asian factories suggest retailers and shoppers share the blame.

Moncler loyalty share plan sullies poster boy look

14 Feb 2020

The $11 bln down-jacket maker wants to double voting rights for long-term owners. That would give boss Remo Ruffini a stronger hand in talks with potential suitors. Weakening shareholder rights might however dent Moncler’s good public company image and irk investors.

Fashion’s climate Frankenstein has no off-switch

7 Feb 2020

Retailers like H&M are promising to slash their carbon footprint by using more recycled products. That’s good, but quick fixes like using sustainable cotton simply move the problem to landfills. Real change would come from tackling the throwaway culture that they represent.

Moncler sings like canary in China’s lux coal mine

18 Sep 2019

Boss Remo Ruffini’s statement of the obvious, that Hong Kong protests will dampen sales of its bling puff jackets, is a warning sign for rivals. With unrest deterring shopping-mad tourists, fully rebuilding on the mainland what’s been lost in the Fragrant Harbour will be tough.

Inditex high street reign comes with higher bar

11 Sep 2019

The Zara owner’s strong first-half sales growth was overshadowed by downward pressure on its gross and operating margin in the second quarter. Investors’ concern about the cost of growing revenue may be valid but a widening valuation discount to peer H&M seems harsh.

Dan Loeb could give Ray-Bans a better look

26 Aug 2019

The pushy U.S. investor is building a stake in $63 bln EssilorLuxottica, maker of the sunglasses brand and others. Although his plans are unclear, the company has unveiled another big deal despite the lack of a CEO and messy corporate governance. A fresh outside lens may help.

Western luxury brands’ China dilemma will worsen

14 Aug 2019

Givenchy, Swarovski and Versace have made grovelling apologies to Beijing for incorrectly implying Hong Kong is a country. The humility comes easily now. Abasement would become more painful, and costly, if China turns up the heat on the special administrative region’s protests.