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KPR Mill registered a mixed performance in Q4, FY24 as its topline revenue decreased notably but profitability increased marginally year-over-year
The company's total revenue declined by 12.9 per cent Y-o-Y to Rs 1696.72 crore during Q4 from Rs 1,949.66 crore in the corresponding quarter previous fiscal. However, on a Q-o-Q basis, the company’s revenue grew by 36.69 per cent to Rs 1,241.31 crore from the previous quarter.
KPR Mill’s net income increased by 1.94 per cent Y-o-Y to Rs 213.61 crore from Rs 209.55 crore in the previous fiscal. On a Q-o-Q basis, the company profit rose substantially by 14.19 cent from Rs 187.06 crore.
Selling, general, and administrative expenses decreased by 0.88 per cent Q-o-Q to Rs 152.24 crore but increased by 6.56 per cent Y-o-Y from Rs 142.87 crore.
The company’s operating income rose by 28.16 per cent Q-o-Q to Rs 285.71 crore from Rs 222.94 crore and by 4.2 per cent Y-o-Y from Rs 274.2 crore.
Patagonia, a well-known outdoor clothing company, is challenging the current throwaway culture in a new film titled ‘Shittropocene’. The film argues that most products today are poorly made and designed to break quickly, leading to overconsumption and environmental damage. It highlights, the current era is defined by mass-produced, disposable crap and calls for a reduction in consumption. However, the film is produced by Patagonia, a clothing company that sells expensive, high-quality clothing. This creates a tension between the film's message and Patagonia's business model.
In fact, the film's message is somewhat contradicted by Patagonia's own business model. The company is still a for-profit business that needs to sell products to survive. And while Patagonia's clothes are built to last, the film itself is a marketing tool designed to drive sales.
Is Patagonia's message genuine?
Patagonia's commitment to sustainability is undeniable. The company offers repair services, upcycling programs, and a resale site to extend the lifespan of its products. These initiatives are commendable and should be emulated by other brands. But Patagonia is also a growing company, which means it's producing more and more clothing. This raises the question of whether any clothing company can truly be sustainable in a system that relies on constant consumption.
The film's message about curbing consumption is undeniably important. However, it's difficult to separate this message from Patagonia's goal of selling more clothes. The film might backfire by encouraging viewers to buy less overall, including from Patagonia.
Patagonia's struggle with its message
Patagonia isn't the first company to grapple with this contradiction. In 2011, the company ran a famous Black Friday ad that said, "Don't Buy This Jacket." The ad was intended to spark a conversation about overconsumption, but it also resulted in a rise in sales for Patagonia. Patagonia acknowledges this internal conflict. The company believes it can be a force for good by encouraging people to consume less and buy higher-quality products. However, it remains to be seen whether this approach can be truly sustainable in the long run.
Patagonia is in a difficult position. The company wants to sell clothes, but it also knows that the fashion industry is a major contributor to climate change. The company's message is to encourage people to consume less, but it is not clear if this message is compatible with its goal of growing as a business.
A new report by Cotton Inc. highlights, US garment prices witnessed their largest monthly rise since late 2021 in March 2024. This uptick comes despite a slight year-over-year increase of only 0.2 per cent. However, it's important to note that apparel import costs remain 4.8 per cent higher than pre-COVID levels. Cotton Inc's ‘Executive Cotton Update: U.S. Macroeconomic Indicators & the Cotton Supply Chain - May 2024’, also highlights a concerning trend of declining consumer confidence for the third consecutive month. This could potentially dampen spending habits and impact the retail apparel industry.
While Cotton Inc, highlights a slight increase, the Bureau of Labor Statistics (BLS) data reveals a different picture. As per BLS the December 2023 price index for US apparel imports remained almost flat compared to January 2023 (106 vs. 100, January 2019 baseline) with a minor fluctuation since the beginning of that year. There was even a slight decline in the price index for imports from China, a major apparel supplier to the US. The BLS data suggests there wasn't a significant increase throughout 2023, but the March 2024 data from Cotton Incorporated indicates a possible shift
So, what's causing the confusion?
There are a couple of reasons why the data might seem contradictory. First, the BLS data is based on a broader range of apparel imports, including different types of clothing and materials. Cotton Inc's report might focus specifically on cotton apparel, which could be experiencing a different price trend.
Second, there's a lag between import price fluctuations and their reflection in retail prices. The recent surge in shipping costs due to the Red Sea crisis, for instance, might not be fully captured in the December 2023 import price data, but it could soon affect what consumers pay for clothes.
Reasons for the increase
Several factors could be contributing to the recent rise in apparel import prices, as per industry experts:
Increase in global cotton prices: Cotton is a major material used in apparel manufacturing, and its price fluctuations can significantly impact the final cost of garments.
Rising transportation costs: Shipping costs have been on the rise in recent months, due in part to the Red Sea crisis that disrupted global shipping routes earlier this year. These increased costs are likely being passed on to consumers.
Disruptions in the textile supply chain due to geopolitical issues: The ongoing trade tensions between the US and China, as well as the war in Ukraine, have caused disruptions in the global textile supply chain. This can lead to shortages of materials and higher prices.
Weakening US dollar: A weaker US dollar can make it more expensive to import goods, as foreign products become more expensive to purchase.
Should it cause concern among US consumers?
The current situation is a double-edged sword. While apparel import prices haven't seen a significant surge yet, there are underlying factors that could lead to future increases. This, coupled with a slight decline in consumer confidence, might put pressure on US fashion retailers. They could be forced to either absorb the rising import costs or pass them on to consumers, potentially leading to higher clothing prices.
It's important to note that the apparel industry is constantly evolving, and these trends can change rapidly. Staying informed about developments in the global cotton market, transportation sector, and geopolitical situations will be crucial for understanding the future trajectory of US apparel import prices.
Labor markets in the US, the UK, and the Eurozone continue to remain under strain with the Eurozone being particularly vulnerable due to its poor labor productivity, as highlighted in a new report by Fitch Ratings. Companies in the
Eurozone have been engaging in labor hoarding—retaining staff despite only a modest increase in aggregate demand. This strategy can lead to rapid workforce reduction in absence of anticipated demand. This can further raise unemployment levels in the region.
In contrast, demand across the US has recovered, expanding labor demand too. However, this rise in demand for labor occurs amid subdued supply and declining participation rates, prompting businesses to enhance productivity by maximising output per worker hour, according to the report titled, ‘Labour Market Resilience in the US, Eurozone, and UK.’
Labor demand in the UK remains weak, compounded by very low growth in labor supply as participation rates continue to fall. Despite this, the unemployment rate remains low, reflecting a stagnant economy and a constrained labor market. The employment rate is currently 2 percentage points below pre-pandemic levels, highlighting ongoing challenges.
India’s cotton exports are projected to increase by approximately 27 per cent to 28 lakh bales during the 2023-24 crop year ending in September. According to the Cotton Association of India (CAI), during the previous 2022-23 crop season spanning October-September, India’s cotton exports totaled 22 lakh bales.
Atul Ganatra, President, CAI, states, the rise in demand for cotton is a result of prices declining to 8-10 per cent lower than international prices from December 2023 to March 2024. India exports its cotton to primarily to countries such as Bangladesh, China, and Vietnam.
CAI also estimates cotton production to remain stable at 309.70 lakh bales during the April 2024 season at 309.70 lakh bales. However, this figure is lower than the 318.90 lakh bales produced in the prior season.
The total cotton supply by the end of April 2024 is projected to be 315.86 lakh bales. This includes 281.96 lakh bales from pressing, 5 lakh bales from imports, and an opening stock of 28.90 lakh bales.
Cotton consumption up to April 2024 is estimated to be around 192.50 lakh bales, with exports pegged at 21.50 lakh bales. The stock at the end of April is anticipated to be 101.86 lakh bales, comprising 40.50 lakh bales with textile mills—equivalent to over 45 days of consumption—and the remaining 61.36 lakh bales held by the Cotton Corporation of India, the Maharashtra Federation, and other entities (including MNCs, MCX, traders, ginners, and undelivered sold cotton).
CAI has also retained its total cotton supply estimate for the 2023-24 season at 359 lakh bales. This total includes an opening stock of 28.90 lakh bales, estimated cotton pressing of 309.70 lakh bales, and imports of 20.40 lakh bales. Cotton imports are projected to increase by 7.90 lakh bales during the year compared to the previous year, CAI notes.
Techno Sport, a leading Indian sportswear brand headquartered in Tiruppur, India, has made waves by becoming the first brand in the country to join bluesign as a system partner. This strategic move underscores the brand's commitment to sustainable practices in the textile industry.
Offering a diverse range of products including Men’s T-shirts, Gym Vests, Jackets, Women’s tights, pants, and Kids’ shorts, Techno Sport not only prioritizes functionality but also provides a plethora of colors and styles for consumers.
Sunil Jhunjhunwala, Managing Director of Techno Sportswear India Pvt. Ltd, hailed bluesign as the gold standard for sustainable textiles, emphasizing its collaborative efforts with brands, manufacturers, and chemical suppliers to create environmentally friendly products and workplaces. Expressing pride in being among the 150 global brands in the bluesign System Partner network, Jhunjhunwala highlighted the brand's eagerness to embrace sustainability.
Joining the bluesign System enables Techno Sport to elevate its commitment to environmental responsibility and innovation. By leveraging bluesign's expertise in evaluating processes and materials, the brand aims to streamline operations while reducing its environmental footprint.
Daniel Rufenacht, CEO of bluesign technologies ag, commended India's textile industry for transitioning into a responsible player in sustainable production. He welcomed Techno Sport's decision to champion sustainability and lead this transformative journey.
Katharina V Mayer, Director CRM, Sub Indian Continent, lauded bluesign as a comprehensive solution for sustainable chemistry in the textile value chain. She expressed delight in having Techno Sport as a bluesign system partner, signaling a collective effort to enhance environmental performance and working conditions.
In addition to this partnership milestone, bluesign introduced its Impact services tailored for the Indian markets, further reinforcing its commitment to sustainable solutions across the global textile supply chain.
Kraig Biocraft Laboratories, Inc. ("the Company") is eyeing a strategic leap into Cambodia to bolster its recombinant spider silk production. CEO Kim Thompson, alongside experts from Kraig Labs and Prodigy Textiles, scouted potential production sites in Cambodia, noting its favorable conditions and proximity to existing operations. The move aligns with the Company's expansion plans following successful spring trials and a surge in demand.
Thompson emphasizes Cambodia's role in diversifying and expanding production, a cornerstone of the Company's strategy. With production set to escalate dramatically in the coming months, reaching a target of one metric ton by year-end, the addition of Cambodian facilities promises to further propel growth.
The announcement underscores Kraig Labs' commitment to innovation and scalability in biotechnology. Thompson and Nirmal Kumar's oversight ensures a meticulous approach to expansion, building on the momentum gained from recent trials.
This strategic pivot towards Cambodia signifies not only a geographical expansion but also a testament to the Company's agility in meeting market demands and capitalizing on emerging opportunities.
The 2024 Textiles Market Situation Report by WRAP paints a mixed picture of the UK's clothing industry. While there's good news in terms of declining clothing costs and a rebound in consumption, significant challenges remain regarding textile waste.
The WRAP report reveals average cost per item of clothing in the UK has dipped 2 per cent to £16.70 ($20.84) in 2023, a trend observed since 2015. At the same time, while COVID-19 initially caused a significant drop in textile consumption, with a decrease of 330,000 tons between 2019 and 2020, consumption figures rebounded swiftly, reaching 1.42 million new textile products in 2022, nearing pre-pandemic levels.
Shifting import landscape
Pre-2021, the report identifies a decline in both the value and volume of textile imports and exports. This is likely due to a combination of Brexit and pandemic disruptions to global trade. While import volumes have recovered by 12.5 per cent post-2021, they haven't reached pre-pandemic levels. Notably, the report highlights a rise in import costs despite a lower volume, suggesting a shift towards more expensive imports (£ per kg ratio).
“The decline in clothing costs is a positive trend for consumers,” says spokesperson for WRAP. “However, the high volume of discarded textiles remains a significant concern. We need to encourage a more circular approach to fashion, with greater emphasis on reuse and recycling.”
Table: Key findings from WRAP report
|
Indicator |
2019 |
2020 |
2021 |
2022 (estimated) |
2023 |
|
Average Clothing Cost (£) |
17 |
N/A |
N/A |
N/A |
16.7 |
|
Textile Consumption (tonnes) |
1.75 million |
1.42 million |
N/A |
1.42 million |
N/A |
|
Import Volume (percentage change) |
N/A |
N/A |
Decline |
+12.5% |
N/A |
|
Discarded Textiles (tonnes) |
N/A |
N/A |
711,000 |
N/A |
N/A |
Despite positive trends, the report raises concerns about textile waste. In 2021 alone, a staggering 711,000 tons of textiles were discarded, with nearly half (49 per cent) ending up in general waste.
The WRAP report underscores the need for a multi-pronged approach to ensure a more sustainable future for the UK's clothing industry. While declining costs and rebounding consumption are positive signs, tackling textile waste through consumer awareness and industry initiatives remains paramount.
Major fashion retailers H&M and Boohoo are being investigated by the UK Environmental Audit Committee (EAC) for their environmental impact, particularly on overproduction, textile waste, and lack of sustainable materials. This is a follow-up to the EAC's 2019 report, ‘Fixing Fashion: Clothing Consumption and Sustainability’. The committee is unsatisfied with the progress made by the industry since then.
EAC’s concerns
The committee is concerned about the lack of progress made by fashion brands since the 2019 report. The EAC is frustrated with the slow progress on its recommendations from the 2019 report, which the government mostly rejected. They will be questioning H&M and Boohoo on the concrete steps they've taken to reduce their environmental footprint. The UK reportedly has the fourth-highest carbon footprint from fashion among G20 nations, and the EAC is determined to address this. The concerns broadly are:
Overproduction: The EAC wants to know what steps these brands have taken to reduce excess production of clothing.
Textile waste: The Committee will question the retailers on their efforts to minimize textile waste generated during production and after garments reach consumers.
Sustainable materials: The EAC will probe how H&M and Boohoo are incorporating sustainable materials into their clothing lines.
While H&M has confirmed their attendance at the hearing, Boohoo has not yet commented. The 2019 inquiry also investigated other brands like M&S, Next, Primark, Debenhams, Missguided, and ASOS.
Possible outcomes
The EAC has a history of pushing for stricter regulations on the fashion industry. They might recommend an Extended Producer Responsibility scheme, which would hold brands financially responsible for their waste. The committee might also revisit proposals for producer responsibility charges to fund better clothing collection and recycling. A ban on incinerating or landfilling unsold stock could also be back on the table. The EAC is likely to push for stricter regulations. This could include:
Extended producer responsibility scheme: Brands would be financially responsible for waste collection and recycling.
Producer responsibility charge: A fee to pay for improved clothing collection and recycling.
Due diligence checks: Mandating checks throughout the supply chain to identify and eliminate labor abuses.
Bans on iIncineration or landfilling: Unsold stock could not be simply trashed.
The fashion industry has a voluntary agreement called the Sustainable Clothing Action Plan, which aims to reduce environmental impact. However, the EAC seems unsatisfied with its effectiveness. This probe highlights the growing pressure on the fashion industry to become more sustainable. The outcome could have significant implications for how these companies operate in the future.
The Global Fashion Summit: Copenhagen Edition 2024 is set to commence on May 22-23 at the Copenhagen Concert Hall, marking its 15th anniversary. Hosted by the Global Fashion Agenda (GFA), a non-profit organization dedicated to propelling the fashion industry towards sustainability, the event will gather esteemed leaders to accelerate social and environmental progress.
Her Majesty The Queen of Denmark will deliver the opening remarks, underscoring her enduring commitment to sustainability since her inaugural attendance in 2009. Joining her will be over 100 speakers from renowned entities like Kering, Patagonia, and The New York Times, convening under the theme 'Unlocking the Next Level'.
As a cornerstone in fashion sustainability discourse, the Summit aims to reflect on past achievements while charting a course for future action. With looming deadlines for previous pledges, the industry faces a crucial moment to intensify efforts and address pressing societal and environmental challenges. Over 1000 stakeholders spanning fashion, policymaking, and solution provision will converge to explore actionable solutions.
The Summit's program features sessions such as 'Luxury, Leather, and Land' and 'Ending Oversupply', alongside an expanded roster of action-oriented roundtable meetings. These closed-door sessions aim to foster collaboration and address key barriers hindering sustainability progress.
Furthermore, the Innovation Forum will showcase cutting-edge sustainable solutions, offering attendees opportunities for collaboration and advancement along the sustainability journey. Federica Marchionni, CEO of Global Fashion Agenda, emphasizes the Summit's role in galvanizing industry efforts towards tangible change, signaling a shift from mere commitments to actionable goals.
With its diverse lineup and focus on practical solutions, the Global Fashion Summit 2024 emerges as a pivotal platform driving urgent sustainability progress in the fashion industry.
