Plain sailing for Pacific

Apparel giant Pacific Brands has weathered a climate of heavy retail discounting by focusing on branded sales growth and improved margins.
The Melbourne-based group achieved earnings before income tax and amortisation (EBITA) of $176.1 million, a 13.5 per cent increase on the previous year. Pacific Brands CEO Paul Moore confirmed this was consistent with full year profit guidance issued in February.
"Even though total sales were down slightly on the previous year, branded sales grew by over 1.5 per cent. Excluding the outerwear and sport group which is undergoing restructuring, branded group sales were up 3.8 per cent on the previous year, 4.8 per cent up in the second half," he claimed.
Pacific Brands had upped its branded product from 70 per cent to 90.8 per cent, ditched low quality non-branded lines and improved margins by centralising buying activities and increasing direct sourcing of "store-ready" product from Asia, he said.
Focus on brands led to a standout performance in the group's footwear division, which posted EBITA of $30.6 million, an increase of 36.6 per cent on the previous year.
Core brands Hush Puppies, Grosby, Julius Marlowe and Naturalizer experienced double-digit sales as a result of investment in product development, while the recently acquired license for US label Merrell would support growth in the premium outdoor category, said Moore.
Underwear and hosiery posted EBITA of $99.6 million for the year, an increase of 10.3 per cent on the previous period, led by core women's brands including Bonds, Jockey, Kayser, Love Kylie, Voodoo and Berlei - currently the top-selling intimates brand across department stores in Australia.
Sales in men's branded underwear increased 6.9 per cent on the previous year, following the introduction of sports performance underwear brand Jockey performance and strong sales in Holeproof Hunks and Bonds.
Moore claimed 2006 would see the group continue to build its brand equity, through focusing on value-for-money products positioned at the quality end of their category.
"It's about getting the right brand in the right channel at the right price point," he said.