FW
French luxury group Kering has issued bonds worth €1.2 billion in total. The bond issue is split in two tranches: a first tranche worth €600 million maturing in three years with a 0.25 per cent coupon, and a second one, also worth €600 million, maturing in eight years with a 0.75 per cent coupon, as indicated by Kering in a press release.
Kering, which owns among others Gucci, Saint Laurent, Balenciaga and Bottega Veneta, said the operation contributes to the diversification of the group’s financing resources and to an increase in its financial flexibility, by enabling the group to refinance its existing debt and extend the maturity date of its funding sources.
Kering underlined that the issue was received very favorably by bond investors, confirming the market’s confidence in the group's creditworthiness. In 2019, Kering had generated revenues of €15.9 billion.
The Karnataka government has permitted garment units in red zone districts, but outside containment zones, to resume operations with one third of the workforce. The order said all recognized garment factories having an Importer-Exporter Code (IEC) and those registered with the Apparel Export Promotion Council (AEPC) can start operations with one third of the total workforce in red zone districts, but outside containment zones.
It said the permission is subject to following of the Standard Operating Procedures. Currently Bengaluru urban, Bengaluru rural and Mysuru are the red zone districts in the state. The government had recently allowed certain industrial activities other than in the containment zones to operate, while relaxing the COVID-19 induced lockdown in the state.
During the earlier phases of lockdown, only those garments units involved in the manufacture of Personal Protective Equipment (PPE) kits for front line COVID warriors were allowed to operate.
Over the past three months, Burberry has introduced several measures to help prevent the spread of the virus and ensure employee safety and wellbeing, including temporarily closing retail stores and implementing strict social distancing protocols. This includes turning over its trench coat factory in Castleford, UK to manufacture personal protection equipment (PPE) for medical and care workers.
The brand has also decided to take the following additional steps to support its priorities over the next few months. These include maintaining the base for all its employees, not relying on government support for jobs in the UK where more than a third of their employees are based; taking a voluntary 20 per cent pay cut from April through June.
The Board of Directors has also agreed to a reduce their basic salary and fees by 20 per cent from April to June with the equivalent cash amount to be donated to the Burberry Foundation COVID-19 Community Fund. The fund, which was established earlier this month for employees to support communities in need globally, is additional to the financial donations Burberry has made to vaccine research and charities alleviating food poverty, with monies going towards procuring and distributing PPE, helping foodbanks and supporting healthcare charities around the world.
The brand’s trench coat factory in Castleford is now manufacturing non-surgical gowns and supplying them to the UK National Health Service. It also sources surgical masks through supply chain and supplying them to the NHS and charities such as Marie Curie, which provides nursing care for families living with terminal illness in the UK.
With sales and earnings sliding, Puma has set itself in a three-phase plan- Survive, Recover, Grow Again to revive growth. These plans will look different in certain markets, as China, Korea, and Europe are making their way toward survival and the US is still very much in the survival phase with so many stores still closed. In the first quarter, the virus outbreak forced Puma to pull an additional $975.92 million from its revolving credit facility and suspend a dividend payment scheduled for May 7.
Although growth was strong at the start of the year, Puma’s sales fell by 1.3 percent to $1.4 billion though this loss still came in above the Wall Street estimate of $1.37 billion. Gross profit margin fell by 140 basis points to 47.6 percent, which, according to Puma, was the result of lower sales in China, inventory devaluation and return provisions.
The company’s operating result (EBIT) decreased by 50 per cent to $77.21 million while net earnings and earnings per share declined by nearly 62 per cent to $39.2 million
Indian Texpreneurs Federation (ITF) has requested the government to lift ban on export of masks as Indian textile manufacturers are now flooded with enquires about immediate supplies of at least 500 million non-surgical fashion masks from leading apparel brands of Europe and the US. This is a business opportunity worth Rs 4,000 crore over next one year and can employ 100,000 workers.
The country had banned export of surgical masks, personal protective equipment (PPEs) and some medicines in March as it faced a shortage of these key items amid rising numbers of Covid-19 patients. Textile industry claimed that the custom authorities are not allowing exports of non-surgical cloth mask, too.
The industry has now assured the government that it can meet the country’s requirement of both surgical and non-surgical masks as well as PPEs with a little handholding. Experts say masks have now become an accessory to the garments being exported. The industry is not only looking at the non-surgical fashion masks but has already invested in manufacturing of the medical grade PPEs and mask.
During the lockdown period, Tirupur had started manufacturing PPEs using sewing machines, which could not be used by the paramedical staff as the holes made during stitching process made it permeable. Now, entrepreneurs from Tirupur have imported 200 seamsealing machines, which started working from last week.
The TEA also requested the government to ensure the logistics support for procuring the raw material and help for transferring of technology from DRDO and other accredited research agencies within a month.
The enforcement of social distancing, lockdowns and other measures in response to the COVID-19 pandemic has resulted in spikes in business-to-consumers (B2C) sales and business-to-business (B2B) e-commerce, says a new report by the World Trade Organisation (WTO).
Demand has also increased for internet and mobile data services. The network capacity and spectrum to accommodate the shift to online activities has urgently had to be adapted by both operators and governments. Demand has fallen, however, for certain services with a large online component, such as tourism services.
E-commerce for goods and services trade has been adversely impacted by the same factors that have caused disruption in supply and demand overall. Such disruptions have resulted in delivery delays or outright cancellation of orders. Several other e-commerce-related challenges have arisen or been further amplified during this pandemic. These include price gouging, product safety concerns, deceptive practices, cyber security concerns, the need for increased bandwidth, and development-related concerns.
The pandemic has highlighted the glaring need to bridge the digital divide, both within and across countries, given the central role the digital economy has played during the crisis. Many traditional obstacles have been accentuated and have continued to hamper greater participation in e-commerce activities by small producers, sellers and consumers in developing countries, particularly in least-developed countries.
The global nature of COVID-19 and its impact on e-commerce may encourage strengthened international cooperation and the further development of policies for online purchases and supply. The pandemic has made it clear that e-commerce can be an important solution for consumers and can also support small businesses and, by making economies more competitive, be an economic driver for both domestic growth and international trade.
As per the US Department of Commerce affiliated Office of Textiles and Apparel (Otexa), Bangladesh's apparel exports to the United States grew by 6.73 percent in the first quarter of 2020 year-on-year, strengthening the country's position as the third-largest supplier to the American market, after Vietnam and China.
Bangladesh fetched about $1.67 billion from apparel exports to the US during the January-March period in 2020, against $1.56 billion earnings during the corresponding period of 2019. However, the country's apparel export earnings witnessed over an 85 per cent decline to $375 million in April 2020, which was $2.54 billion in the same period last year.
Experts and exporters opined that the growth happened since Bangladesh had not been affected by the novel coronavirus till March. At that time, Chinese factories faced closures and supply chains had been disrupted due to the Covid-19 outbreak. The US also witnessed a tough phase of the outbreak, resulting in retail store closures. As a result, their imports fell by 12.07 per cent to $17.84 billion in the first quarter of 2020.
Exporters believe that Bangladesh's apparel exports will observe the effect the outbreak of coronavirus for the next two to three months as most factories were closed for the last one month – March 26 to April 26.
Between January and March 2020, Bangladesh shipped 602.98 m. sq. mt. of apparel goods to the US. But apparel exports from Cambodia and Pakistan saw growths of 14.4 per cent and 13.8 per cent, respectively. According to the BGMEA, cotton products constitute a share of 74.14 percent of Bangladeshi apparel exports. Against an increased demand for cotton, import of the item from the US has increased over the last few years.
Clean Clothes Campaign has encouraged brands to help suppliers ensure that their employees have safe workplaces and transportation, including safe distance between employees and the availability of protective equipment revealed by workers’ surveys.
A startling investigation by the Clean Clothes Initiative and Germany-based Bread for the Planet reveals that about 120,000 workers across Europe are forced to work in high-risk conditions following closures in the workplace worldwide. No EU law is yet in place to ensure brands and retailers respect human rights through supply chains and ban unfair and inhumane trade practices.
In Serbia, Ukraine, Croatia and Bulgaria, employees are still working for far less than a living wage for German fashion brands including Hugo Boss, Gerry Weber, Esprit, as well as German supermarket and drugstore chains. In spite of the pandemic, factory managers continue to force workers to report to work despite the high risk of infection of Covid-19 and in contravention of international guidelines.
Wages of garment workers remain extremely low in the Eastern and South Eastern Europe manufacturing industries. A Ukrainian tailor will earn around 126 Euro per month, leaving no room to save money for contingencies such as the current Covid-19 crisis.
Even the meager wage is actually not charged because in Germany clothing firms cancel and factories shut down, not in order to protect workers, but because work does not exist. Employees indicated that they are now forced to go on unpaid leave to Clean Clothes Drive, leaving those already on the poverty line in even more desperate circumstances.
Leading footwear brand, Aldo is seeking protection from creditors by declaring bankruptcy in Canada, Europe and US. In Canada, the company has been seeking protection under the Companies’ Creditors Arrangement Act from the Superior Court in Quebec and is filing for bankruptcy in US under Chapter 15 along with preparing to do the same in Switzerland.
The court filings indicated that the company sold $1.2 billion worth of merchandise by the end of February this year against losses of merchandise worth $74.8 million in Canada and $52.8 million in US. The company did not pay rent for its stores for April and May, but the lockdowns have drained the cash reserves leading to their effort to seek protection as they restructure the company.
Although their stores remain closed until guidelines from concerned authorities in each country, the ‘Aldo, Call It Spring’ and ‘Globo’ websites remain open for orders during the bankruptcy proceedings.
Despite the challenges facing the wool sector due to the Covid-19 pandemic, British Wool is collecting and receiving wool as usual.
The company’s network of depots and collection sites are ready to start receiving wool from producers – which, given the circumstances is quite an achievement. Also, following the Government guidance related to Covid-19, company has ensured that protocols are in place for the safety of producers as well as British Wool staff.
However, the Covid-19 pandemic has had a significant impact on the global wool market which affected British Wool before the rest of the UK due to the reduced demand from the Chinese market in January. The global cross bred wool market slowed significantly in February and then shut completely at the beginning of March and remains closed.
According to company, February to May is normally the busiest selling period of the year and, as a result, British Wool has approximately 7 million kgs extra of unsold 2019 clip wool on top of the approximately 3 million kgs that it would normally be carrying at this time of year.
The severe drop in demand for wool products coupled with the huge global overhang in cross bred wool stocks from the 2019 season is likely to severely impact prices for the next 12-18 months. It will also make the company’s longer term objective of repositioning British Wool as a premium product more challenging. However, finding new demand for 9ts wool in China at attractive prices will be a key driver of the early stages of recovery in British Wool prices.
