From the Sector

ISKO provided their latest innovation in material science to British designers, Priya Ahluwalia, Masha Popova, Chet Lo and Aaron Esh, for the London Fashion Week SS24 season.

Alongside supplying their latest denim fabrics, ISKO opened its doors to its London-based product development centre, Creative Room London, for finishing and washing of their final designs as well providing expertise and knowledge in denim design and construction.

Priya Ahluwalia
For Ahluwalia’s Spring Summer 24 collection, entitled Acknowledgements, Creative Director and founder Priya Ahluwalia’s research led her on a journey of creative rediscovery.
ISKO’s Ctrl+Z fabric, which is made entirely from recycled and regenerated fibres, was used to create the flower motif denim showcase within 3 looks across jeans and jackets. This development contains no virgin cotton and uses a minimum of 60% recycled materials and the remainder is regenerated cellulose fibres while still giving a look and feel identical to traditional denim and speaks to Ahluwalia’s ongoing commitment to sustainable design and business practices.

Chet Lo
This season, Chet Lo took an active stand in reclaiming the power lost during his youth, healing the childhood wounds inflicted by a society that sidelined differences instead of celebrating them.
ISKO’s Ctrl+Z fabric and specialist lasering techniques from ISKO’s Creative Room was used across three looks featuring signature Chet Lo erotic laser prints across denim bottoms.

Aaron Esh
The SS24 season marked the brand’s debut at London Fashion Week, a homecoming of sorts for Esh, who was born and raised in the heart of the British capital, studied at Central Saint Martins and became a finalist at the LVMH Prize earlier this year. The early impulses of Aaron Esh remain steadfast: clothes that combine establishment rigour with the rebellious spirit of youth culture, devotedly crafted for a generation who feels somewhere in-between.
Aaron created bootleg denim ripped jeans made entirely from ISKO Denim using R-TWO50 fabric, which comprises a minimum of 50% pre and post-consumer recycled content. The designer noted the addition of denim accompanied by leathers add a new level of depth to their latest collection.

Masha Popova
Masha Popova’s sophomore catwalk outing, MONSTER was a “seasonless” offering that combines Autumn Winter 2023 and Spring Summer 2024.
Masha continued her obsession with denim manipulation, using various finishings including over-dyeing, flocking, patchwork, scratching and fraying in a variety of colours from vibrant green to silver across jeans, tops and jackets, all developed with the help of ISKO’s Creative Room, London.

Global Fashion Agenda (GFA) presented a new online film series: Fashion Redressed. Produced by BBC StoryWorks Commercial Productions, the captivating series intends to inspire the industry to take action to transform the way we produce and consume fashion.

Every day we express ourselves through our clothes. Encompassing cultures, personalities, traditions and beliefs, fashion is core to how we present ourselves to the outside world. But our consumption of fashion and clothing is pushing our planet and societies to its limits. Fashion trendsetters and pioneers are working to meet this challenge head-on with game-changing ideas. At the heart of this is the question: how can we keep expressing all we do through fashion, but without hurting the planet?
 
Focused on finding the answers, Fashion Redressed, comprises multiple films that showcase organisations from across the fashion and textile industries. Launched on a BBC.com microsite, the series spotlights the innovations across the world that are influencing the new seasons of fashion, featuring a collection of stories that depict tailor-made solutions to fit us and our planet.
 
The 11 self-contained branded films showcase a range of participants including: eBay, Elk, The Ellen MacArthur Foundation, Vestiaire Collective, Spinnova, Lenzing, Faherty, FarFetch, Waste2Wear, Colorifix and Forest Stewardship Council. Each film focuses on a bespoke solution that can benefit us and the planet. From the scientist taking inspiration from silk-spinning spiders in Helsinki and the duo taking a deep dive into the genetic makeup of colour in Cambridge, to the pre-loved clothes being brought to life on a global platform from Paris and the importance of cultural appreciation in Arizona, fashion gathers the most creative and innovative minds. This series expresses the dynamism and creativity of the fashion world, spotlighting the people weaving change into the fibres of fashion and those who are working to find the stylish side of a more sustainable sector.
 
The series was unveiled ahead of GFA’s landmark event – Global Fashion Summit: Boston Edition – on 27 September. The forum will bring together fashion stakeholders for agenda-setting discussions and productive meetings on critical environmental and social issues.

Following the successful inaugural launch last Spring, adidas TERREX and National Geographic join forces once again with a collection designed to capture the awe-inspiring beauty of the Aurora Borealis.

The core images of the Northern Lights, as captured by National Geographic photographers, are interpreted in different ways on different products, taken through different hues and applied in different places per garment. These include:

• The TERREX Swift R3 GORE-TEX National Geographic hiking boot – Blending the lightweight design and cushioning of a trail running shoe with the stability and durability of a hiking boot
• The all-gender TERREX National Geographic RAIN.RDY 3-IN-1 Jacket – Combining 2.5L waterproof RAIN.RDY shell and polar fleece inner jackets for elevated protection and versatility with a strong visual design inspired by the northern lights.
• The TERREX National Geographic Softshell Jacket – A functional and stylish option for any adventure outdoor-seekers may have on their agenda. Reinforced shoulders, chest and forearms provide abrasion resistance.
• The TERREX National Geographic High Pile Fleece Jacket – The add-on for chilly days in the great outdoors. The Fleece Jacket features reflective elements that ensure visibility and safety in the low lights.

With over 400 exhibitors, the fourth Istanbul Fashion Connection event from August 9-11, 2023, at the Istanbul Expo Center on 35,000 sqm was again successful.

With over 20,000 visitors from more than 125 countries, IFCO recorded an increase in visitors of over 30% compared to August last year. International visitors more than doubled, with the largest visitor groups coming from Asia and the Middle East at 33% each, Europe at 17%, Africa 11% and the Americas at 6%.

All retail channels were represented at the show, from large shopping mall and department store groups to wholesalers, international retail chains, multi-brand boutiques and online platforms.

Exhibitors
In six clearly segmented halls, more than 400 brands presented themselves on 35,000 sqm from womenswear, menswear, kidswear sportswear, denim, leather and fur.

The Core Istanbul
For the second time, the exclusive design area The Core Istanbul, originally launched as part of Istanbul Fashion Week, presented itself at IFCO. Among others, Arzu Kaprol, Ceren Ocak, Çiğdem Akın, Essin Barış, Ezgi Karayel, Fulyaİlkmen - F.ILKK, Mehmet Emiroğlu, Meltem Özbek, Mert Erkan, Merve Ulu - Kuela, Murat Aytulum, Nejla Güvenç - Nej, Özlem Erkan, Selin Küçüksöz, Tuba Ergin joined the show. Menswear was also represented with Emre Erdemoğlu, Seydullah Yılmaz - SYHZ Wear and Yakup Biçer - Y Plus.

The Exclusive Area
Leading Turkish retail brands, already internationally active, showed in The Exclusive Area such as B&G Store, Climber BC, Damat, Giovane Gentile, Hatemoğlu, Ipekyol, Kayra, Kiğılı, Lee Cooper, Lufian, Jakamen, Naramaxx and convinced with their high quality, sustainable and fashionable products, which were in great demand among international buyers. Jakamen opened the IFCO Shows on the first day of the fair with its latest spring / summer collection for 2024.

FashionIst
With its own catwalk, the occasion fashion section FashionIst for women and men featured thirty leading brands and showed a cross-section of the latest designs in evening fashion with their innovative colors and dynamic styles. Daily fashion shows informed visitors about the latest trends.

B2B Match Making
The B2B Match Making at IFCO took place in speed dating mode and was well received. Exhibitors were efficiently networked with buyers from all over the world such as Inditex from Spain, Walmart, Quicksilver, Teddy Fresh or Wilbo from the USA, Sainsbury's from the UK, Cihuah from Mexico, the Apparel Group and Safari Group from the United Arab Emirates, Ria Miranda from Indonesia, Hi Style and Zalora from Malaysia, Musinsa from South Korea, Ackermans from South Africa etc.

IFCO February 2024
For the next date of IFCO (7.-10. February, 2024), the organizers expect more than 600 companies. The participation of international fashion companies is to be expanded, for which IFCO provides the ideal springboard into the European and Asian markets.

Germany-based ZwissTex is a leading manufacturer of textiles with over 150 years of experience, creating innovative and sustainable textile solutions for the automotive and apparel industries. The company also operates in Mexico, to specifically serve the automotive sector across North American Free Trade Agreement (NAFTA) markets. Via OEMs, ZwissTex supplies German automakers including Volkswagen Auto Group, BMW, and Mercedes, as well as American manufacturers in select cases.

Unlike other Kornit customers, ZwissTex had no previous experience printing their own materials, and saw Kornit’s sustainable, single-step, Presto MAX S production system as an effective means of increasing their product capabilities.

“Our textiles were not classically printed in the past, and we did not produce any classical textiles in fashion, which is why we didn’t have any printing experience internally,” said Ralph Moldan, Technical Specialist at ZwissTex, as the system was being installed in their facility. “The only option was to find a system that would enable us to implement the areas in which we are active on the market easily and quickly, without requiring a lot of printing experience.”

One benefit of integrating Kornit technology into the ZwissTex production ecosystem: applying ink only where it is needed and seen, rather than to the full surface of each material. This translates to both reducing the company’s carbon footprint, and minimizing materials waste for a more cost-effective operation.

Prior to making the decision to invest in Kornit, ZwissTex conducted a series of tests and consultations, evaluating possible applications for different materials and engaging with their own key clients to ensure these finished products would meet their rigorous quality and durability standards. This included presenting Kornit-decorated samples at the Techtextil 2022 exhibition in Frankfurt.

Moldan found Kornit’s production capabilities opened new doors to customization of interior areas, a market that continues to grow. He anticipates this technology will create new opportunities with customers they could not reach previously, including new opportunities in sectors such as motor homes, airlines, and aircraft outfitters.

As part of the 12-piece collection, adidas introduces the SST Jacket – for men and women – as well as the Avacourt in a refreshed look. Both pieces share a bold blue hue – synonymous with the outfit that Billie Jean King wore in the Battle of the Sexes match – which is applied throughout the collection as a consistent design story.

The SST Jacket is inspired by the classic adidas tennis tracksuits from the era when Billie Jean King was at the height of her career, changing tennis on and off the court for years to come.

The Avacourt, having originally launched in 2022, is created and engineered to best support women when playing tennis – featuring a women’s specific last, increased torsion, softer materials and a midfoot support saddle. Updates for the 2023 season bridge today’s silhouette with the one worn by Billie Jean King 50 years ago – which was adidas’ first ever signature tennis shoe for women – via its color story, as well as key material updates. The suede leather tongue has a retro feel and soft premium touch, with the toe guard made from a synthetic suede finishing. Adding to the comfort, the heel collar is lined with terry cloth – a fabric synonymous with the era.

Other key pieces in the collection include the Tennis Modular Leotard AEROREADY Pro with detachable skirt, the Tennis Transformative AEROREADY Dress Pro that evolves into two different styles, and the Tennis Reversible AEROREADY Match Skirt Pro with Tennis HEAT.RDY Short Tight Pro layered underneath. For men, key pieces include the Tennis HEAT.RDY Freelift Polo Shirt Pro, the Tennis Reversible AEROREADY Freelift T-Shirt Pro and the Tennis AEROREADY 2 IN 1 Short Pro.

The Munich-based startup Sizekick launches a new technology and attracts well-known brands and retailers to reduce size-related returns in e-commerce. With the apparel technology know-how of the strategic partner and investor Hohenstein and the AI-based technology of Sizekick, more sustainable shopping in e-commerce with less CO₂ emissions will be made possible. The technology company is now celebrating a successful market entry: The newly developed sizing AI is now available for fashion e-commerce stores and is pleased about the first successfully acquired customers. The first customers to join the company include the Swiss multi-brand store for sustainable fashion, Rrrevolve, the premium outdoor brand Black Diamond from the USA, and Marc Cain, a global brand with German roots in the premium sector.

The solution promises to add value for both brands and consumers when shopping online by taking individual body measurements into account when recommending the right clothing size. The AI-based technology always offers two options to help arrive at the appropriate size recommendation. With BodyFinder, the AI suggests realistic body shapes to choose from. Alternatively, the video-based BodyScanner option enables a body scan via the smartphone's video function. All it takes to do this is to turn around in front of the phone's camera. Fashion brands and fashion retailers now have easy access to the new technology, as integration in the e-commerce store takes just a few minutes.

Hohenstein's expertise helped the Sizekick team to link accurate body measurements with the right product properties. Hohenstein is considered a leader in the field of size & fit and has been advising companies in the textile industry for over 75 years. The Sizekick fit analysis not only supports the brands' product teams, but is also used as direct input for Sizekick AI.

• Currency-neutral revenues flat versus the prior-year level
• Top-line development reflects improved sell-out trends and conservative sell-in strategy
• Gross margin up 0.6pp to 50.9%; strong improvement compared to Q1 reflecting better sell-through and less discounting
• Operating profit of € 176 million includes extraordinary expenses of around € 160 million related to one-off costs, donations and accruals for future donations
• Inventory position improves substantially versus Q1 level to € 5.5 billion; now up only 1% year-over-year

In the second quarter of 2023, currency-neutral revenues were flat versus the prior-year level. The top-line development continued to be impacted by the company’s conservative sell-in approach in order to reduce high inventory levels, particularly in North America and Greater China. At the same time, adidas second quarter revenues benefited from the first sale of some of its Yeezy inventory. The initial product drop in June generated revenues of around € 400 million in Q2, which is largely in line with the Yeezy sales generated in the prior year’s quarter.

Footwear revenues grew 1% during the quarter, reflecting strong growth in football, basketball, tennis and US sports. Apparel sales declined 3% in the second quarter. As the apparel market continues to be particularly overstocked, the company continued its conservative sell-in strategy to improve sell-through and margins in the medium term. Accessories grew 8% during the quarter driven by growth in football.  

Lifestyle revenues were down during the quarter despite extraordinary demand for the company’s Samba, Gazelle and Campus franchises. While adidas slowly started to scale its offering for these product families during the second quarter, the total volume still only represents a small portion of the company’s overall business. Sales in the adidas Performance categories continued to show positive momentum. This reflects strong demand for new product introductions such as the latest iterations of its Predator, X and Copa football boots, as well as jerseys for both the FIFA Women’s World Cup 2023 and the company’s unique portfolio of football teams ahead of the start of the European club season. In addition, the Adizero product family in running continued to gain a lot of attention around marathon races across the world, translating into higher demand. At the same time, the brand’s Barricade tennis franchise grew strongly, leveraging the excitement around major tournaments.

In euro terms, the company’s revenues declined 5% to € 5.343 billion in the second quarter (2022: € 5.596 billion).

Stronger sell-out trends and conservative sell-in
As a result of the company’s initiatives to reduce high inventory levels, currency-neutral sales in wholesale declined 10% despite double-digit growth in Greater China and Latin America. At the same time, direct-to-consumer (DTC) revenues grew 16% versus the prior year. This development was driven by strong growth in both the company’s e-commerce business (+14%) as well as own retail stores (+19%), reflecting continued strong sell-out trends across most regions. The outperformance of the company’s DTC channel versus the wholesale business was also related to the first sale of the Yeezy inventory, which was done exclusively through adidas’ own e-commerce channel.

Double-digit growth in Greater China and Latin America
Currency-neutral sales in North America declined 16% during the quarter. The region is particularly affected by elevated inventory levels in the market and – in response to this – the company’s significantly reduced sell-in. Revenues in Greater China grew 16% in Q2, reflecting double-digit sell-out growth in both wholesale and own retail. Sales in EMEA were down slightly (-1%) despite double-digit DTC growth. While the company’s initiatives to reduce inventory levels and discounting weighed on the overall top-line development in the region, adidas recorded significantly improving full-price trends during the quarter. Revenues in Asia-Pacific increased 7% during the quarter, driven by strong double-digit growth in DTC. Latin America continued to increase at a double-digit rate (+30%), reflecting strong growth in both wholesale and DTC.

Gross margin improves to 50.9%
The company’s second quarter gross margin increased 0.6 percentage points to 50.9% (2022: 50.3%). This improvement was mainly driven by price increases the company has implemented as well as by an improved channel mix. At the same time, higher supply chain costs and unfavorable currency movements continued to strongly weigh on the gross margin development. While still adversely impacting the company’s gross margin in the quarter, discounting levels significantly improved compared to the first quarter of the year.  

Operating profit of € 176 million, resulting in an operating margin of 3.3%
Other operating expenses were up 3% to € 2.582 billion (2022: € 2.501 billion). As a percentage of sales, other operating expenses increased 3.6 percentage points to 48.3% (2022: 44.7%). Marketing and point-of-sale expenses decreased 7% to € 617 million (2022: € 663 million). As a percentage of sales, marketing and point-of-sale expenses slightly decreased by 0.3 percentage points to 11.5% (2022: 11.8%). Operating overhead expenses were up 7% to € 1.965 billion (2022: € 1.838 billion), reflecting higher logistics expenses. In addition, the company recorded one-off costs of around € 50 million related to the strategic review the company is currently conducting as well as donations and accruals for further donations in an amount of around € 110 million. As a percentage of sales, operating overhead expenses increased 3.9 percentage points to 36.8% (2022: 32.8%). The company’s operating profit amounted to € 176 million (2022: € 392 million) in the quarter. This amount includes the extraordinary expenses of in total around € 160 million reflecting the one-off costs related to the strategic review as well as the donations and accruals for further donations. The sale of the Yeezy product positively impacted adidas’ operating profit by an incremental amount of around € 150 million in Q2. The operating margin reached 3.3% in the quarter (2022: 7.0%).

Net income from continuing operations of € 96 million
After taxes, the company’s net income from continuing operations amounted to € 96 million (2022: € 360 million), while basic EPS from continuing operations decreased to € 0.48 (2022: € 1.88).

Outlook

adidas expects revenues to decline at a mid-single-digit rate
On July 24, adidas had adjusted its full year financial guidance to reflect the positive impact of the first sale of some of its Yeezy inventory and a slightly better-than-expected development of the adidas business in the first half of the year. At the same time, macroeconomic challenges and geopolitical tensions persist. Elevated recession risks in North America and Europe as well as uncertainty around the recovery in Greater China continue to exist. In addition, the company’s revenue development will continue to be impacted by the initiatives to significantly reduce high inventory levels. As a result, adidas now expects currency-neutral revenues to decline at a mid-single-digit rate in 2023 (previously: decline at a high-single-digit rate).

Underlying operating profit anticipated to be around the break-even level
The company’s underlying operating profit – excluding any one-offs related to Yeezy and the ongoing strategic review – is still anticipated to be around the break-even level. Including the positive impact from the first Yeezy drop of around € 150 million, the potential write-off of the remaining Yeezy inventory of now € 400 million (previously: € 500 million) and one-off costs related to the strategic review of up to € 200 million (unchanged), the company now expects to report an operating loss of € 450 million in 2023 (previously: loss of € 700 million).

On August 2, the company launched a second drop of Yeezy inventory. Throughout the month of August, adidas is making a range of existing products available through both its own e-commerce channel as well as the digital platforms of selected wholesale partners. If successful, this second drop would further improve the company’s results. However, as the results of this drop are yet unknown, it is not accounted for in the company’s current top- and bottom-line outlook for 2023.

On the occasion of the 2023 UCI Cycling World Championships, the Union Cycliste Internationale chose Santini to make the bibs from recyclable materials. The UCI's partner brought together a pool of companies, all in the Bergamo area (Italy): RadiciGroup, Sitip, EFI Reggiani and Acerbis.

In 2022, the Union Cycliste Internationale released the UCI Climate Action Charter, which lays out an action plan to advance the environmental sustainability of the sport with a specific principle to reduce waste and accelerate the transition to a circular economy. This year, the UCI Cycling World Championships, which will be held from 3 to 13 August, are bringing together most of the cycling disciplines in a single location: Glasgow and across Scotland.

To mark the occasion, the UCI turned to its Official Partner, Santini, to make the bibs that the staff (judges, volunteers, commissaires etc.) and accredited photographers wear throughout the event. The bibs are "eco-designed", which means they are specifically created to have a second life after use. Once the event is over, the bibs could be collected and sent to RadiciGroup and transformed into new material, to be then processed by Acerbis to create X-Elite handguards for mountain bikes. This project is a concrete example of the circular economy at work, allowing 100% of the materials used to be recovered.

To optimise the production cycle of the bibs for the 2023 UCI Cycling World Championships, the products must be eco-friendly from the very first phase. The fabrics were therefore made from Italian nylon yarn produced by RadiciGroup. The choice of nylon – an infinitely recyclable thermoplastic material – is intertwined with UCI's sustainability goals for "limited-use" garments: RadiciGroup was able to channel its know-how and expertise in the field of chemistry to create "circular" bibs, working alongside the other partners. As the innovative yarn selected by RadiciGroup allows for easy and high-quality printing, the fabric is also customisable. The yarn is then provided to Sitip to create the "ARAS NG" warp-knitted fabric (95 g/100 m2): a recyclable single-fibre material made from 100% polyamide. The resulting fabric is the first nylon of its kind, designed to meet the transfer printing needs of the third project partner, EFI Reggiani, as well as the recyclability standards requested by RadiciGroup. The choice of fabric was born from extensive applied research, in which EFI Reggiani tested a wide range of fabrics to find the best colour results and the best resistance to rubbing and perspiration, which is vital for the bibs' intended use. In addition to using the new GOTS-certified EFI Reggiani IRIS Plus water-based inks, EFI Reggiani opted for a printing solution on transfer paper that does not consume water and requires a minimal amount of energy per square metre. Finally, the white fabric from Sitip and the transfer paper printed by EFI Reggiani arrived at Santini, who were responsible for transferring all the graphics for the 2023 UCI Cycling World Championships bibs from the paper onto the fabric. Santini also took care to assemble the garments using only thread and components made from nylon or chemically similar materials, allowing the bibs to enter the recycling process at the end of their lives without any further processing.                   

adidas announced a further release of YEEZY inventory with a range of existing products being available in phases throughout the month of August across the world. As previously communicated, adidas will donate a significant amount to selected organizations working to combat discrimination and hate, including racism and antisemitism.

As with the release in May 2023, the second release will feature products which were initiated in 2022. The range available will include some of the most popular existing designs including the YEEZY BOOST 350 V2, 500 and 700 as well as the YEEZY SLIDE and FOAM RNR.

adidas will continue the support of partners combatting discrimination and hate with donations to existing and new partners. The company will continue to support the work of the Anti-Defamation League (ADL) and the Philonise & Keeta Floyd Institute for Social Change. In addition, adidas is proud to partner with Robert Kraft’s Foundation to Combat Antisemitism (FCAS) to fight all forms of hate.

To create further impact adidas will show support for the Foundation to Combat Antisemitism by including blue square pins with selected products sold directly by adidas in North America. These blue square pins were established by FCAS through their #StandUpToJewishHate campaign launched earlier this year, as the universal symbol for standing in solidarity and unity in the fight against antisemitism and all hate.

Since terminating the YEEZY partnership in October, adidas has been exploring multiple scenarios for the potential use of the existing YEEZY inventory. The process involved seeking feedback and listening to a diverse group of employees, organizations, communities, and consumers for how to responsibly manage the existing product.