LUXURY IS BACK: FULL RECOVERY SEEN BY '05 (CONT.)

“The market is beginning to pick up,” said Bernard Fornas, president of Cartier International, which manage a dozen boutiques in Italy. “SARS is over, and Americans and Asians are beginning to travel again.” In the meanwhile, as it was clearly emphasized last November during the Milan Fashion Global Summit, Italian and European luxury goods firms are exploring new markets, the Chinese one in particular. De Sole pointed out that the market is going through a dramatic change, “with Chinese tourists replacing the Japanese.” last year, Italian jeweler Bulgari opened two boutiques in Shanghai and Beijing and expects China to become the second most important Asian market after Japan within five years. The company believes that in a decade, sales in China could make up more than 10% of Bulgari’s total revenue, up from less than half per cent expected for this year. Following the steps of Bulgari, Italian shoemaker Tod’s is planning to open two boutiques in China next year. “Nobody can afford to ignore Asia and China,” said Diego Della Valle, Tod’s Chairman and Chief Executive Officer, who pointed out that, excluding China, Asia accounts for 8% of Tod’s global sales and is growing at 35% per year.

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ITALIA LIFE IN I STYLE: THE ITALIAN TRADE COMMISSION’S CAMPAIGN TO PROMOTE ITALIAN FASHION AND ACCESSORIES

The Italian Trade Commission’s (ITC) promotional campaign, Italia: Life in I style is moving forward with exciting and informative cultural and commercial events to promote fashion, accessories, footwear and textiles in the United States.  Italia: Life in I style, a custom-published magazine, has been one of the ITC’s most successful initiatives.  First published in May 2002, the second issue appeared on time for the Christmas holiday season in December 2002.  One million copies of Italia: Life in I style were distributed as a supplement to six of Hearst’s leading fashion and home design publications. The 160-page edition contains stories about many elements that make up Italian lifestyle including fashion, home design, cinema, jewelry, ceramic tiles, wine and travel.  A retrospect on Italian fashion, focusing on collections from the 20th century, staged at the Fashion Institute of Technology (FIT) on February  2003 and  ran through April 2003.  The exhibition, “Fashion, Italian Style” (www.fashionitalian-style.com), was curated by Valerie Steele, fashion historian and curator of the Museum of FIT.  Historical pieces from leading designers were on display together with photographs that highlighted the transformation of fashion over the last century.  During 2003 the Italian Trade Commissione established a unique partnership with one of New York’s most influential department stores.  From March to December 2003, windows at the luxury retailer Bergdorf Goodman were dedicated to Italian fashion and special events such as trunk shows were held at the store. In addition, the Italian Trade Commission organized a promotion along New York’s Madison Avenue entitled “Italy Salutes New York.”  Participating Italian boutiques offered extended hours and special activities between March 27th and April 6th.  The public was invited to check out the latest fashion and accessories from Italy and to enter a drawing to win exceptional prizes. The Fall 2003 campaign included an exhibition celebrating Italian design called “1950-2000 Theatre of Italian Creativity” (www.italian-creativity.com). The show, curated by Italian architect Gae Aulenti, debuted in New York City on October 10th, 2003 and featured some of the finest examples of Italian design. The exhibit is set up chronologically and takes the visitor on a delightful “trip” through five decades that begins with the Vespa/Lambretta and ends with the Ferrari. One of the highlights of the “Italia Life in I style” campaign in Fall 2003 was the Italian Trade Commission promotion with Neiman Marcus. The promotion was held for two weeks in October at the Dallas and Houston stores as well as at all Neiman Marcus stores nationwide. Italian products were showcased and featured in a series of special events and in the Neiman Marcus publications. In November 2003 the Italian Trade Commission also partnered with the New York stores of Brooks Brothers to promote their “Made in Italy” Lines. Along with Italian products being featured in the Fifth Avenue and 53rd store the promotion included special events and advertising. As always the Italian Trade Commission’s efforts to support Italian companies interested in breaking into the American market are continuing.  Autonomous exhibitions are planned as well as participation within major trade shows. On the calendar so far for 2004 are: WSA, Ffany, Magic, Los Angeles Texitalia  and I-TexStyle.  Special advertising opportunities are made available to Italian firms exhibiting in an ITC show or pavilion. The ITC’s newsletters for both American retailers and Italian manufacturers are now published on a regular basis. The publications include newsworthy stories about the Italian and American fashion industries and the calendar of the ITC’s activities throughout the year. Fostering relationships with retailers and exposing them to Italian lifestyle and products firsthand is a top priority.  One of the ways the ITC accomplishes this is by sponsoring trips to trade fairs and factories.  Retailers have been invited to a variety of shows including Pitti Immagine Uomo, Moda In, Micam and Mipel, to name a few.  With so much product available in the global economy today, there is a need to continuously demonstrate to American buyers why Italy is a leader in the fashion industry. The Italia: Life in ‘I’ style campaign is designed as a permanent effort to promote three key areas of Italian production: fashion (Moda), home design (Abitare) and film (Filmare). The Italian Trade Commission (known in Italy as “I.C.E.”) is the government agency entrusted with promoting trade, business opportunities and industrial cooperation between Italian and foreign companies, mostly by organizing the participation of Italian firms in fairs, exhibitions, workshops and bilateral meetings in more than 100 countries all over the world. For more information contact the Italian Trade Commission  in New York .

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ITALIAN TRADE COMMISSION BUILDS RETAIL RELATIONSHIPS

Since 1995 independent specialty retail stores in America have received a unique kind of support from the Italian Trade Commission (ITC) to help them sell fashion made in Italy. The approach is simple: create Italian-themed promotions to lure consumers in to shop. The ITC’s lifestyle campaign, Italia: Life in I style, takes it one step further by delivering the message why Italian fashion is better. High quality fabrics are used in the most sought after designs and the craftsmanship is unrivaled – indeed much of the assembling is still done by hand in Italy. “We believe that by collaborating with retailers we will be able to show consumers what makes Italian fashion superior,” says Roberto Luongo, executive director for the USA at the ITC. The ITC works with retailers all over the country to develop promotions that create excitement for their customers. Store anniversaries are often marked by fashion shows highlighting Italian fashion and sumptuous displays of food and wine. Weather-permitting, events can be staged outdoors like a human chess game held in Charlotte, N.C., echoing a 400-year old tradition in the town of Marostica, Italy, And to the delight of many customers, the latest Italian sportscars and motorbikes frequently adorn a retailers’ front doorstep. Local charities are often recipients of the good will that retailers vigorously foster their hometown communities. Says Roberto Luongo, “Many Americans, especially in big cities, already appreciate the fine products that Italy has to offer, like apparel, footwear and accessories. What we want to do is reach into the heartland of the U.S. and show everyone that the things that make Italian lifestyle desirable are available in their areas too”. Currently, “Italia: Life in I style” promotions are planned with more than 40 U.S. apparel and footwear stores. For more information, contact the Italian Trade Commission.

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FIRST FULL FALL/WINTER  COLLECTIONS AT THE I-TEXSTYLE TRADE SHOW

On October 15 & 16, 2003, I-TexStyle, a premier show of Italian fabrics organized by the Italian Trade Commission, presented full collections for the first time. The show also moved to the North Pavilion at the Jacob Javits Convention Center in New York. Traditionally held in January and July as a pre-collection show, I-TexStyle’s new October dates afforded exhibitors the unprecedented opportunity to show their complete Fall/Winter 2004-05 collections. “This new edition of I-TexStyle in October gave designers & buyers the opportunity to see the full collections from 50 top Italian mills and access to the incredible innovation and creativity that the Italian weavers offer,” says Rossana Ciraolo, Fashion Director of the Italian Trade Commission. I-TexStyle also featured a trend display area, featuring swatches from the exhibiting companies. I-TexStyle is endorsed by the Italian Textile fairs: Prato Expo, Moda In and IdeaComo and is supported by the Italian Trade Commission’s worldwide lifestyle campaign, “Life in I Style.” I-TexStyle brought together fifty key weavers from the leading fabric regions of Italy, including Prato, Como and Biella.  These exhibitors presented fabrics across all fashion categories including womenswear, menswear, sportswear and eveningwear.

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NINTH EDITION FOR THE LOS ANGELES TEXITALIA SHOW

The Italian Trade Commission in New York organized the ninth edition of “TEXITALIA” in Los Angeles, a collective of Italian apparel textiles, from October 20-22, 2003. The exhibition, showing apparel textile collections for Fall/Winter 2004/2005 ranging from the medium-high to high price points, –featured 20 Italian mills and one button manufacturer, the majority of which were from Tuscany (11), mainly from the district of Prato, from Lombardy (7), from the district of Como, and from the Piedmont and Veneto regions. This edition of the show was marked by an increase in the number of visitors, amongst whom were names such as Liz Claiborne and Bebe, which goes to confirm growing interest in the fashion industry on the West Coast. During the next edition of the show, which will be held in April 2004, the New York office of the Italian Trade Commission plans to introduce fashion trend presentations and a collaboration project which will involve West Coast Design Schools.

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THE FINEST ITALIAN FOOTWEAR AT FFANY NEW YORK SHOW

At the last Ffany, held at the Javits Center from December 8-10 December 2003, some 25 companies were all part of “Shoes from Italy”, a special exhibition on Italian footwear organized by the Italian Trade Commission in partnership with the Italian Association of Footwear Manufacturers (ANCI). Featuring men’s, women’s and children’s footwear of medium/ high and high quality, ranging from comfort to fashion to casual – this was the first Italian Pavilion at Ffany supported by the Italian Trade Commission and ANCI. “Together with ANCI, we want to start a new presence of Italian companies in New York and support companies who can showcase new trends, new technologies and new style – said Roberto Luongo, Executive Director for the US at the Italian Trade Commission. The show, held at the Jacob Javits Convention Center in New York and also in some designated show rooms, attracted more than 3500 buyers coming from all over the U.S..

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ITALIAN FASHION MART: MORE THAN 200 BUYERS IN FLORENCE

From November 8th to November 10th, 2003 about one hundred Italian companies met more than 200 buyers coming from all over the world. The event took place at Stazione Leopolda in Florence, a very unusual and unique place for business meetings. The focus was on footwear and accessories. The Italian Trade Commission in New York, in partnership with the Italian Association of Buying Offices, invited to Italy about 36 US retailers coming from all over the US, from Hawai to Virginia, Illinois, and Ohio. Representatives from department stores such as Bloomingdales and Saks Fifth Avenue joined the group, as well. Retailers were given the opportunity to work in a very relaxed atmosphere and, at the same time, experience the real Italian way of life, by enjoying Italian food and entertainment. The event was also aimed at showing foreign retailers how to buy from Italy by working with a Buying Office, which handles all the sourcing for the client according to the guidelines received. The National Shoe Retailers Association (NSRA) selected the US and Canadian buyers taking part to the event.

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WWW.BG-MENS.COM: THE NEW WEBSITE FOR ITALIAN MENSWEAR & ACCESSORIES

During the month of December 2003, the Italian Trade Commission and the luxury specialty store Bergdorf Goodman launched their first web site entirely dedicated to menswear and accessories. Featuring high-end Italian brands such as Luciano Barbera, Bottega Veneta, Lorenzi and Etro, the web site represented the first on line experience for Bergdorf Goodman and it was aimed at informing the customers on products available and at attracting them to the stores, not at selling. The web site was also advertised on line on the New York Times Magazine and in W Magazine personal shopper section. The number of contacts made was outstanding and, following this success, the Italian Trade Commission and Bergdorf Goodman are planning to partner again on other new projects.

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NEIMAN MARCUS CELEBRATES THE ART OF ITALIAN STYLE

This past Fall, the Italian Trade Commission’s (ITC) promotional campaign, Italia: Life in I Style, with the support of leading Italian Trade Associations, joined together with retail legend Neiman Marcus to celebrate THE ART OF ITALIAN STYLE; a mélange of Italian culture, art, fashion, and food. The October event showcased the individuality of Italian designers and the quality of Italian manufacturing through a series of outstanding events. Neiman Marcus stores nationwide kicked off “The Art of Italian Style” promotion on October 10, 2003, with in-store festivities including personal appearances, trunk shows, lifestyle exhibits, as well as Italian art and food.  Special menus designed specifically to highlight the culinary richness of the country made appearances in the 43 Neiman Marcus restaurants nationwide. The event culminated with celebrated designer Roberto Cavalli, who made personal appearances on October 14th and 15th, as well as played host to his own fashion shows with Neiman Marcus, in both Dallas, TX, and Houston, TX, to kick off “The Art of Italian Style.”  The Dallas event was attended in excess of 500 people, amongst whom Consul General of Italy in Texas, Massimo Rustico, a number of Texan socialites, press and buyers. In addition to the in-store events, the promotion included special inserts on Made-in-Italy products in the Neiman Marcus catalogue, the book, in their newsletter as well as in the “InCircle Entrée” magazine, which is distributed exclusively to Neiman Marcus’s top customers.

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CHINA CHALLENGES ITALY’S TEXTILE AND SILK INDUSTRIES

Northern Italy, one of the major players in the European textile and clothing industry, is struggling to absorb the impact of imports from China. Europe’s trade gap with Beijing is only about 10 billion dollars, less then a tenth of the United States’, but the industry appears more vulnerable than in the North America, where only 15% of jobs are in the manufacturing sector. In Italy the percentage is almost double the amount, while in the Como area, where 90% of Italian silk is produced, nearly a third of the job market is link to the textile industry. “We have the roots, the culture of silk production,” said  Graziano Brenna, president of the textile section of the Industrial Union of Como, to the Washington Post. “China has copied us. What can we do? But our design sense and creativity is not just a function of technology. It’s also a reflection of what’s valued around the world: our style and taste.” Another major problem for the Italian textile industry, and the silk production in particular, has been the year long rise of the euro against the dollar. The strength of the European currency led to a large decrease of Italian imports into the United States, where the Chinese textile and silk is now dominating the market.

Similarly to what is happening in the United States, where lobbies and trade group are pressing the White House to initiate new laws to curb textile imports from China, some Italian policymakers are asking the government to set up protection measures from the Chinese threat. However, on a recent trip to China, Italian Prime Minister Silvio Berlusconi said that rules within the World Trade Organization should guarantee enough protection for our market.  The Washington Post points out that Italy, like most countries, has an ambivalent relationship with globalization. “As some people here in the US decry the erosion of manufacturing, consumers snap up a flood of low-cost Chinese goods,” the Post said.

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ITC: INDUSTRY AGREEMENT WITH THE ITALIAN JEWELLERY ASSOCIATIONS

Adolfo Urso, Vice Minister of Industry and Foreign Trade, signed in December 2003 the first industry agreement with jewellery associations and the main agencies which organize events in the area of Arezzo, Valenza-Po and Vicenza. The overall funding will be 1 million euros, half of which will be allocated by the Ministry and the Italian Trade Commission and half by the Ente Fiera di Arezzo, Valenza-Po and Vicenza. "An important agreement which will strengthen the sector, especially in the main market: the USA" said Urso, who added that the jewellery sector is a driving force for exports. About 70% of the Italian production is exported worldwide, representing 4,830 million euros on the balance of trade.

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VERY  STRONG THIRD QUARTER FOR GUCCI GROUP

The Italian fashion house Gucci Group announced very strong financial results for the third quarter of 2003, a performance that substantiates analysts’ expectations for a potential rebound of the luxury-goods industry later this year. The company, battered last December by the decision of Chief Executive Officer Domenico De Sole and Creative Director Tom Ford not to extend their contracts beyond April 2004, reported profits of 53.1 million euros (67.4 million dollars), a slight increase from a year earlier. Total revenues were 695.0 million euros (882.6 million dollars), up 12.8% on a constant currency basis. "This has been a great quarter for the Group. All divisions performed extremely well, led by Gucci’s outstanding sales and profits growth,” Mr. De Sole said. “The spectacular Fall ready-to-wear collection has been driving traffic into the Gucci stores and generating strong sales worldwide,” he added. De Sole pointed out that with 20% retail sales growth in the United States and Europe, the Gucci division is one of the best performing luxury brands in the world. In the third quarter the division’s operating income before goodwill amortization was up 11.2% to 100.9 million euros (128.1 million dollars) from 90.8 million euros (115.3 million dollars). The division revenues were 373.1 million euros (473.8 million dollars), compared to 355.7 million euros (451.7 million dollars) in 2002, up 4.9%. Measured on a constant currency basis, retail sales in the United States increased 20.4%, with double-digit growth both on the mainland and in Hawaii. In Europe the increase was 9.4%. Excluding Italy, where local customer and tourist demand was weak during the quarter, retail sales grew 21.7%, led by exceptional performance in the UK (+45.8%). As for Bottega Veneta, in the third quarter the division achieved retail sales growth of 51.1%, thanks to the outstanding performance in the U.S. market, with an increase of 65.8%.

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FILA LEAVES THE NYSE: SOON ITS STOCKS WILL BE DELISTED FROM THE BIG BOARD

Fila is leaving Wall Street, or so it seems.  The beloved Italian fashion house, founded in 1928 in Biella, is not abandoning the American consumer market, where is now doing very well, however, the company is trying to get its stock delisted from the  New York Stock Exchange.  The decision is not a strategic one at all.  Au contraire. It was reached in view of the fact that Fila has recently completed the sale of all of its operating subsidiaries: “accordingly, has ceased being an operating company”, as a NYSE press release points out.  In other words, the company has basically become an empty shell, without any operational assets.  The sale took place during the summer, when the Italian conglomerate RCS MediaGroup, formally known has Holding di Partecipazioni (HdP), sold Fila to Sport Brands International (SBI), controlled by the U.S. private investment fund Cerberus, for 351 million dollars in cash.  The deal, completed last June after long and challenging negotiations, gave Fila’s brand name, production capabilities, distribution, and franchising agreements to SBI.  Following the sale, Fila’s assets consisted of 30 to 35 million dollars in cash and no operational subsidiaries.  Last October, the company decided to change its name from Fila Holdings to RCS Investimenti and concluded a cash tender offer to purchase the ordinary shares of Fila that it did not already owned.  RCS is now controlling approximately 98.2% of the company’s shares. The stocks – has recently been suspended from trading at the NYSE and it will be soon be delisted. “We are committed to perpetuating and enhancing Fila’s position in the marketplace and see a tremendous opportunity to successfully leverage the brand and its lifestyle appeal,” Jon Epstein, President and CEO of SBI, says.

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BENETTON: POSITIVE OUTL0OK FOR THE PERIOD 2003-2007

During a recent meeting with the financial community, Benetton Group presented upbeat projections for 2003-2007, a period in which the company intends “to leverage the strong global recognition of its brands, in particular United Colors of Benetton and Sisley.” The Italian fashion group, based in Ponzano Veneto, forecasts a revenue growth for the four-year period of 22.5%, with a target of 991 million euros (1.3 billion dollars) in revenues for 2007. “The gross margin for the period is influenced principally by the significant reductions in industrial costs, in part linked to the process of delocalization of manufacturing activities in Europe,” the company stated in a press release. EBIT is expected to increase over 40% in the period 2003-2004, demonstrating “the strong capacity to generate value of the Benetton business model. Overall investments for the period are expected to reach 430 million euros (546.1 million dollars). Approximately half of the total will be dedicated to the commercial network.

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PRADA THINKS OUTSIDE THE BOX AND INVESTS IN REAL ESTATE

Italian fashion group Prada Holding is putting nine properties in Europe and North America into a real estate fund that it hopes to sell to outside investors. The fund is worth 160 million euros (203 million dollars). The properties include “very prestigious” locations in Italy, France and the U.S. that the company is currently using as office and storage space. Prada said that it is in talks to sell a majority stake of the fund to the financial holding company Beni Stabili and a minority stake to Italian bank Banca Intesa.

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Luxury is back

Italia life in I Style campaign

Retail relationships

I-Texstyle trade show

Ninth edition for Texitalia

The Ffany New York Show

Italian Fashion Mart

www.bg-mens.com

Neiman Marcus and Italian Style

China challenges Italian textile

Industry agreement with jewellers

Very strong quarter for Gucci

Fila leaves the NYSE

Positive outlook for Benetton

Prada invests in real estate

Italian Style Index

Italian trade shows

US/Italy trade data

The performance on Wall Street

The performance on the Milan Stock Exchange

Calendar

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* by invitations only

The above dates are subject to change without notification by show organizers. Please contact the respective offices directly for updates, catalogues or registration information.

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January 8-11, 2004

Buyer trip to PITTI  IMMAGINE UOMO

Florence Italy

January 16-18, 2004

Buyer trip to PITTI BIMBO

Florence Italy

January 21, 2004

MODA IN Trend Presentation for Spring/Summer 2005

Speaker: Angelo Uslenghi

Tinker Auditiorium, New York

January 25-27, 2004

Made in Italy at the COLLECTIVE

Italian menswear companies exhibiting at the Collective

Organized by  EMI-Ente Moda Italia

The Show Piers, New York

January 30 - February 1, 2004

Press trip to the home furnishings trade show PITTI IMMAGINE CASA

Florence Italy

February 9, 2004

Special insert in “Footwear News”

“Importing from Italy”
To be distributed at the WSA show in Las Vegas

February 10-13,  2004

Italian  Pavilion at WSA

Mandalay Bay, Las Vegas

February 12, 2004

Seminar

“Creating Excitement in your Store” The Best Display Ideas from Italy

In conjunction with ANCI and NSRA

Sands Expo, Las Vegas

February 2004

Special Insert in MR Magazine featuring Italian companies at  MAGIC INTERNATIONAL

To be distributed at Magic International, Las Vegas

February 23-26, 2004

Italian Pavilion at MAGIC INTERNATIONAL

Las Vegas Convention Center, Las Vegas

February 29 - March 2, 2004

Made in Italy at the Fashion Coterie

Italian womenswear companies exhibiting at the FASHION COTERIE

Organized by  EMI-Ente Moda Italia

The Show Piers, New York

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