From the Sector

Major developments:

• Currency-neutral sales up 11%, driven by adidas brand accelerating to 16% growth
• adidas brand up double digits across all channels with increases in all markets
• Underlying gross margin improves around 1.5 percentage points to 50.5% despite significant currency headwinds
• Operating profit of € 346 million compared to € 176 million in prior-year period
• Healthy inventories at a level of € 4.5 billion to support future top-line growth
• Full-year guidance upgraded on July 16 to reflect current brand momentum

Full-year outlook
High-single-digit revenue increase expected in 2024
On July 16, adidas raised its top- and bottom-line guidance as a result of the better-than-expected performance during the second quarter and taking into account the current brand momentum. adidas now expects currency-neutral revenues to increase at a high-single-digit rate in 2024 (previously: to increase at a mid- to high-single-digit rate). The company’s operating profit is now expected to reach a level of around € 1.0 billion (previously: to reach a level of around € 700 million). Within this guidance, adidas assumes the sale of the remaining Yeezy inventory during the remainder of the year to occur on average at cost. This would result in additional revenues of around € 150 million and no further profit contribution during the second half of 2024.

Outlook impacted by significant currency headwinds
The company continues to expect unfavorable currency effects to weigh significantly on its profitability this year. These effects are negatively impacting both reported revenues and the gross margin development in 2024. This was particularly the case during the first half of the year.

At the upcoming edition of CAITME, to be held in Tashkent, Uzbekistan from September 11 to September 14, 2024, 16 Italian textile machinery manufacturers will exhibit in the common area set up by the Italian Trade Agency and ACIMIT.

All these companies are ACIMIT’s associated members: Bonino, Brazzoli, Carù, Erhardt+Leimer, Guarneri Technology, Ima, Laip. Lgl, Martex, Mei, Mesdan, Pinter Caipo Italia, Pugi Group, Sicam, Stalam, Ugolini.

Uzbekistan is one of the largest producers and exporters of cotton and its textile industry is a relevant driver for the national economy. Thanks to the raw material’s availability and low production costs the business conditions are favourable for the development of the local industry. The upgrading of installed equipment is considered a step to achieve this goal.

Italian textile technology is well known by the Uzbek textile companies. In 2023, Italian sales in Uzbekistan amounted to 21 million euro. Among the Italian machines most in demand by Uzbek textile companies are weaving machines (32% of total 2023 Italian exports), followed by finishing machines (30%), spinning machines (17%), knitting machines (14%) and accessories (7%). At CAITME Italian exhibitors will show the most advanced technology applied to the textile sector, offering proper solutions in terms of efficiency, costs saving and sustainability.

Highlights Q2 2024 (compared with Q2 2023)

• Organic sales up 2%, with volumes up 1%; Revenue up 2%
• Operating income €270 million (2023: €279 million)
• Adjusted EBITDA €400 million (2023: €397 million); Adjusted EBITDA margin 14.4% (2023: 14.5%)
• Net cash from operating activities positive €151 million (2023: positive €305 million)

Highlights half-year 2024 (compared with half-year 2023)

• Organic sales up 2%, driven by higher volumes and positive price/mix; revenue flat
• Operating income €531 million (2023: €461 million)
• Adjusted EBITDA €763 million (2023: €702 million); Adjusted EBITDA margin 14.1% (2023: 13.0%)
• Net cash from operating activities negative €19 million (2023: positive €255 million)

Outlook
Based on current market conditions and constant currencies, AkzoNobel expects to deliver 2024 adjusted EBITDA towards the lower end of its full-year guidance range of €1.5 to €1.65 billion.

• Order intake of CHF 403.4 million in the first half of 2024, up 24% on the previous year period
• Sales of CHF 421.0 million 44% below first half of 2023
• Order backlog of around CHF 640 million at June 30, 2024
• EBIT of CHF 8.9 million and net result of CHF 1.7 million
• Significant cost reductions as a result of the “Next Level” performance program
• Outlook for the full year 2024 specified

In the first half of 2024, the Rieter Group posted an order intake of CHF 403.4 million (first half of 2023: CHF 325.0 million), which represents a significant increase of 24% compared with the same period of the previous year. Sales were CHF 421.0 million (first half of 2023: CHF 758.2 million). As expected, this was 44% lower than the previous year.

In a challenging business environment, Rieter achieved an EBIT margin of 2.1% thanks to strict cost management. The systematic implementation of the “Next Level” performance program led to a strengthening of profitability. Rieter recorded a profit at the EBIT level of CHF 8.9 million in the first half of 2024 (first half of 2023: CHF 25.2 million). The reduction of the cost base particularly in research and development as well as selling and administrative expenses contributed to this positive result.

Outlook for the full year 2024 specified
The markets remained under pressure from the economic slowdown, high inflation rates and noticeably dampened consumer sentiment. The first signs of a recovery in financial year 2024 have emerged in the key markets of China and India. Rieter expects demand to pick up further in the coming months.

For the full year 2024, Rieter anticipates sales in the range of CHF 900 million to CHF 1 billion and a positive EBIT margin of 2% to 4%.

adidas announced preliminary results for the second quarter of 2024. In Q2, currency-neutral revenues increased 11% versus the prior year. In euro terms, the company’s revenues grew 9% to € 5.822 billion (2023: € 5.343 billion). Excluding Yeezy sales in both years, currency-neutral revenues increased 16% during the quarter.

The company’s gross margin reached 50.8% in Q2 (2023: 50.9%). The underlying adidas gross margin improved strongly, reflecting better sell-throughs, reduced discounting, lower sourcing costs and a more favorable category mix. The significantly smaller Yeezy business had a negative impact on the year-over-year comparison. The company’s second quarter operating profit increased to € 346 million (2023: € 176 million), including a contribution of around € 50 million from the sale of parts of the remaining Yeezy inventory.

Following the better-than-expected performance during the quarter and considering the current momentum, the company has increased its full-year guidance. adidas now expects currency-neutral revenues to increase at a high-single-digit rate in 2024 (previously: increase at a mid- to high-single-digit rate). The company’s operating profit is now expected to reach a level of around € 1.0 billion (previously: to reach a level of around € 700 million).

Within its guidance, the company assumes the sale of the remaining Yeezy inventory during the remainder of the year to occur on average at cost. This would result in additional sales of around € 150 million and no further profit contribution during the remainder of the year.

The company continues to expect unfavorable currency effects to weigh significantly on the company’s profitability this year. These effects are negatively impacting both reported revenues and the gross margin development in 2024. This was particularly the case during the first half of the year.

Today more than ever, sustainability in the fashion sector is an imperative that is reshaping the dynamics of the sector. These are important changes driven both by increasing CSR regulations (for example, Business of Fashion revealed that, according to 87% of players, the new regulations will impact their company in 2024), and by consumers’ habits (increasingly sensitive to the topic and consequently more careful in purchasing choices). In this scenario, Lectra analyzed real-time data from Retviews – its artificial intelligence-based solution specialized in competitive intelligence and automatic benchmarking – and unveils how Retviews’ empowers brands to navigate the complexities of sustainable and optimized collection planning.

According to Retviews data, to face sustainability challenges and best orient in the current complex fashion landscape, it will be crucial for brands to keep 5 key indications in mind:

1. Planning sustainable collections
Faced with the new regulations, brands are called to rethink their strategies, without losing sight on performance. For this reason, brands are already moving to optimize and rationalize the creative processes of their collections with a view to sustainability. In particular, Retviews' real-time data analysis reveals a growing trend towards sustainability in the collections of leading brands, where there are important investments in sustainable fabrics for both upper and lower garments. In particular, in the "Top" section, shirts show the most significant growth year over year among the eco-responsible options.

2. Sustainable prices (in every sense)
In this context, the redefinition of prices requires a strategic balance between market dynamics and the consumer's willingness to pay for products redesigned in terms of CSR. Retviews data shows a significant increase in costs in sustainable top collections. However, has this shift affected stock levels?

3. Inventories: optimized management
Tracking stock levels is crucial to season management, as it helps identify best-selling items and trends, as well as identify which items would sell better at full price versus those that should be discounted.
The new premium prices for sustainable collections require optimization of the sales rate, a waste limitation to minimum and a reduction of unsold goods rate.
Analyzing the tops category - In the tops category, where sustainably made products prevail with significantly higher price points than generic tops, Retviews' real-time data reveals that sustainable collections boast a higher sell-out rate compared to non-sustainable products. This superior sell-out rate underscores consumers' willingness to pay a premium for sustainability

4. Traceability and certification of collections
Certification is essential in verifying sustainability claims, fosters trust and ensures compliance. Not only that, it is also important to understand the value of the certifications and which ones appear most frequently in the various markets so as to make targeted decisions and adapt the assortments accordingly. This also let brands to prioritize the right mix of fabrics that can reflect the desires of local consumers. Retviews data highlights a particular focus on “Recycled Claim Standard” (RCS) certification in Europe and on “Fair Trade” and “Good Cashmere Standard” certified garments in the United States.

5. Mix of sustainable fabrics
About environmental impact, fabrics also play a fundamental role. Through data-driven tools, brands are able to find valuable information on sustainable materials that are gaining tractions in collections and thus make informed and strategic decisions in the process of planning their creations.

The 15th In-store Asia 2024, a trade fair for retail resources and investment in store designs, visual merchandising and in-store marketing on the Indian subcontinent, has drawn to a successful close. From 13 to 15 June numerous exhibitors and retailers got together at the Bombay Exhibition Center in Mumbai to network and experience the latest trends and innovations in the industry.

Registering more than 5,500 trade visitors, In-store Asia 2024 exceeded all expectations and confirmed its position as a leading platform. The three trade fair days played out in a lively atmosphere with many business leads.

Solutions providers presented a comprehensive line-up of innovative products and solutions, which are required for installing modern, connected and targeted Points of Sale. Exhibits included POP and interactive displays, visual merchandising solutions and retail technologies, shopfittings complete with lighting, signage and display mannequins as well as retail designs. The event provided visitors including the decision-makers of retail brands as well as service providers, architects, designers, marketeers and retail specialists with a perfect setting for networking, exchanging ideas and forging strategic partnerships.  

Trade fair highlights included:

• VM&RD Retail Design Awards: The Awards recognised outstanding examples of retail design and visual merchandising. Over 300 submissions in 24 categories by more than 40 companies were assessed by a jury composed of international design experts.  
• VM Challenge: 40 visual merchandisers from more than 20 enterprises competed with each other in six teams in a live window-dressing competition to create imaginative decorations on the theme of “Surreal Chic” in 60 minutes.
• Focal Points: Skechers, Lifestyle, Pepe Jeans and Ace Turtle impressed participants with innovatively dressed shop windows demonstrating the strength of creative design in retail.

The next In-store Asia will be held from 22 to 24 May 2025.

In den letzten Wochen kam es im Mode- und Schuhhandel vermehrt zu Rabatt-Aktionen. In diesem Zusammenhang weist der BTE darauf hin, dass vor allem pauschale Reduzierungen auf das gesamte Sortiment die von der Branche mehrheitlich gewünschte Verlängerung der Sommer-Saison konterkariert. Immerhin haben sich laut der BTE-Umfrage von Anfang 2024 nur sieben Prozent der Mode- und Schuhhändler dagegen ausgesprochen.
 
Der BTE appelliert daher an die gesamte Mode- und Schuhbranche, sich aktuell mit breiten Rabattaktionen zurückzuhalten. Preisnachlässe auf schlecht laufende Artikel vor allem aus dem Frühjahr können zwar betriebswirtschaftlich sinnvoll sein, größere Reduzierungen von Sommerware sollten aber möglichst vermieden werden. Schließlich ist die Verlängerung der Sommer-Saison wegen des zuletzt oft warmen Herbstes notwendig, um rückläufige Umsätze im September/Oktober auszugleichen.
 
Bei der aktuellen Rabattplanung sollte unbedingt bedacht werden, dass es - anders als in den Vorjahren - bislang noch keine längere Schönwetter-Phase gab. Vor allem Bedarfskäufer haben sich daher noch kaum mit Sommerware eingedeckt. Zudem stehen rein statistisch die wärmsten Wochen des Jahres noch bevor. Damit besteht höchstwahrscheinlich noch ausreichend Zeit für den Verkauf von sommerlichen Artikeln - vielfach noch zu regulären Preisen.
 
Hinweis: Zum traditionellen Termin des Sommer-Schluss-Verkaufs wird der BTE wegen der hohen Medien-Nachfrage erneut eine Pressemeldung herausgeben. In diesem Jahr fällt der Start auf den 29. Juli 2024. 

As part of the European Erasmus+ project AddTex, the partner organisations organised several hackathons at the universities of Boras (Sweden), UPC (Spain), PIN (Italy) and TUS (Ireland) in May. The aim is to connect students with real challenges in the industry and promote innovation in the areas of ecology, sustainability, digitalisation and design. The participants had received basic information in advance through the 45 training videos and training sessions of the free and public Smart, Digital and Green Skills Academy at https://addtex.eu.

The hackathon at the Italian university PIN (Polo Universitario Città di Prato) was organised and held together with the technical textiles department of the Industrieverband Veredlung - Garne - Gewebe - Technische Textilien e.V. (IVGT). Eight teams competed to develop innovative, sustainable ideas in just a few hours for the German family business Schmitz Textiles GmbH & Co. KG, Emsdetten. Schmitz Textiles, an expert in complete textile solutions for indoor and outdoor use for over 100 years, plans to offer exclusively sustainable products in the medium term and is looking for solutions to continuously increase the existing recycled share of yarns to 100 per cent.

Stefan Schmidt from IVGT presented the challenge via Teams Conference: "We are looking for a new business model for textile recycling at awning manufacturer Schmitz-Textiles in order to increase the existing proportion of recycled yarns and go beyond the exclusive use of recycled PET bottles. Schmitz Textiles has had an awning fabric made from 100% recycled polyester in its range since the end of 2023. The medium-term goal is to switch the entire range of awning fabrics to 100% recycled yarns. The company is looking for suitable solutions to achieve this.

In small teams, the 30 students specialising in eco-design, textiles/sales and textiles/technology developed proposals and presented them in five-minute online pitches. Ralf Bosse for Schmitz Textiles and Iris Schlomski for the IVGT acted as the jury and assessed the individual presentations in the categories of degree of innovation, presentation, industrial application potential and potential for commercial success. Each idea presented and each presentation scored more or less points in the individual categories. In the end, the points scored were added up to determine the winning team, which can further develop its idea together with the company. For Schmitz Textiles, these are Eleonora Boccherini, Ilaria Ioja, Giorgio Gacci and Marianna Butera.

After a debut in 2023, Dibella exhibited again this year at the Cruise Ship Interiors Design Expo America (CSI Americas) in Miami, a leading trade fair for cruise interiors.

Under the motto “You create the stories for amazing dreams - We provide the restful sleep”, Dibella presented its latest developments in textile flat linen at the Convention Center in Miami/USA from 6 to 7 June 2024: bed linen and terry products that not only offer maximum comfort and durability but are also perfectly tailored to the special requirements of the maritime environment.

"The trade fair in Miami was a great success for us. In particular, our newly developed JAVA hand and shower towels and our VIRGINIA bed linen, both with regenerated cellulose fibers Lyocell, were very well received due to their special soft feel. We have had many rewarding discussions with existing customers and new prospects and are very much looking forward to working with them in the future,” says Marvin Groß-Hardt, Export Sales at Dibella.

CSI Americas, which has doubled in size since its inception in 2019, had more than 250 exhibitors this year. The show showcases brands in cruise design, attracting representatives from the industry's largest design firms and cruise lines each year.