Hmm...

Very interesting that H&M announces it's collabo with Versace one day before releasing its Q2 earnings, which are expected to drop for a record-breaking third consecutive period:

Earnings at H&M (HMb.ST), the world's second-largest fashion retailer, are expected to have dropped in the second quarter as the firm chose not to pass on higher costs such as cotton and Asian wages to price tags.

The Swedish budget apparel firm, with some 2,300 stores in 40 countries, will publish its March-May report on June 22 after unveiling last week a mere 2 percent year-on-year rise in sales to 27.6 billion crowns amid slack spending in Europe.

The mean forecast in a Reuters poll of analysts is for a 16 percent drop from last year in pretax profit to 5.89 billion crowns ($921 million). The gross margin is estimated at 62.0 percent, down from 65.9 percent a year ago.

Madonna For Macy's?

In today's "You're About Two Decades Late" headlines, WWD is reporting that Madonna is in talks with Iconix Brand Group to launch a contemporary women's line that will be sold exclusively at Macy's department stores:

The merchandise would include apparel, accessories, intimates and footwear. Label names under serious consideration for the product lines include Material Girl for the apparel and Truth or Dare for the lingerie and underwear.

I know I should reserve judgement until I see the clothes, but I must admit that my initial reaction is: Do people want to dress like Madonna? Her M by Madonna line for H&M had several cute pieces that would fit the Macy's aesthetic, but it wasn't as well received as people expected.  Which brings us to the subject of the success rate of celebrity lines:

Speaking to American Public Media, Marshall Cohen, NPD's senior analyst, estimated that the misses in celebrity lines outnumber hits by a two-to-one margin. Jessica Simpson had a successful footwear collection but has struggled with sportswear. Jennifer Lopez pulled the plug on her Sweetface last year amid the recession. Other fashion failures included efforts from Eve, Paris and Nicky Hilton and Whitney Port. (SOURCE: Retail Wire)

Madonna must bring something new and fresh, and naming your line Material Girl or Truth or Dare won't cut it.

H&M Teams Up With Sonia Rykiel For Winter '09 and Spring '10 Collections

Nathalie Rykiel, President and Artistic Director at Sonia Rykiel

(Photo: Matthieu Salving/H&M)

H&M has tapped Sonia Rykiel as guest designer for their Winter 2009 and Spring 2010 collections. This will be H&M's eighth partnership with a high-end designer.

The winter collection will consist of lingerie and accessories, making this the first time H&M has ventured into the world of lingerie. The line will launch on December 5th, and will be available in 1500 H&M stores worldwide. The lingerie collection will simultaneously be available in Sonia Rykiel boutiques worldwide.

The Spring 2010 collection will consist of Rykiel's infamous knitwear for women and girls, as well as accessories. This collection will launch in 250 H&M on February 20, 2010.

“Sonia Rykiel is a true fashion icon who invented a signature style around femininity, Parisian chic and modernity - as well as functional, comfortable, wearable clothes", says Margareta van den Bosch, H&M's creative advisor.

Nathalie Rykiel, president and artistic director of Sonia Rykiel says, "The Sonia Rykiel pour H&M lingerie collection is the ideal way to offer the essence of Rykiel to a great number of women around the world, and a beautiful way to close the year. The knitwear collection is perfect for welcoming a colourful new season".

H&M Sales Drop Worsens in August Because of Inventory Shortage

By Sarah Shannon

Sept. 24 (Bloomberg) -- Hennes & Mauritz AB, Europe’s second-biggest clothing retailer, said a sales decline worsened in August because of a shortage of discounted inventory.

Revenue at stores open at least a year fell 11 percent last month, the fourth consecutive drop and worse than July’s 3 percent decrease, Stockholm-based H&M said today. The retailer also reported a 4 percent gain in third-quarter net income to 3.46 billion kronor ($504 million), below the 3.5 billion kronor average estimate of 11 analysts compiled by Bloomberg.

H&M said sales in Spain, the U.S. and France were “weak” in the third quarter because it had too little inventory to keep pace with discounting by competitors. Same-store sales declined 6 percent, though gross margins widened by 0.8 percentage points, led by internal currency hedging policies.

“The stock is down as people are looking at the markdowns and the sales deterioration,” Chris Walker, an analyst at Nomura, said by phone. “The gross margin is a positive surprise from their hedging policy, so we’re not too concerned.”

H&M fell 12 kronor, or 2.9 percent, to 396.50 kronor at 11:10 a.m. in Stockholm trading. The shares have risen 30 percent this year, compared with the 27 percent gain of rival Inditex SA.

H&M said it plans to increase store numbers by 240 this year, raising the target from 225. Planned openings include 18 Monki and Weekday stores and nine higher-priced COS outlets. The retailer will start selling fashions online in the U.K. from fall of 2010, it also said today.

‘Demonstrating Confidence’

“This is clearly demonstrating business confidence and we expect will be positively received by the market,” Alessandra Coppola, an analyst at Standard & Poor’s Equity Research in London, said by e-mail. She has a “sell” recommendation.

Third-quarter revenue was 23.5 billion kronor excluding value-added taxes, the company said, an increase of 13 percent from a year earlier, or 3 percent excluding currency swings.

“H&M results were weaker versus our expectations,” Simon Irwin, an analyst at Liberum Capital said in a report. “We believe H&M needs sustainable upgrades from same-store sales or further progress on costs to justify higher prices,” of the stock, he wrote. Irwin has a “neutral” recommendation.

(SOURCE: Bloomberg.com)

Jimmy Choo Comes to H&M!

Shoes from the upcoming Jimmy Choo for H&M collection

(Photo: Magnus Magnusson/H&M)

ATTENTION ALL SHOENISTAS & BAGNISTAS!

H&M has announced that they will team up with Jimmy Choo to offer a fabulous collection of shoes and handbags for the fall. This will be H&M's first collaboration with an accessories brand.

The collection will hit 200 H&M stores worldwide on Nov. 14th. Known primarily for its shoes and handbags, Jimmy Choo will also offer women's clothing and men's shoes, bags and accessories.