EU's Dombrovskis: EU issues guidance on MIFID research for US brokers; US brokers to receive relief supplying research to EU companies
Hilton beats by $0.06, beats on revs; guides Q4 EPS in-line; offers FY18 RevPAR outlook (71.32)
- Reports Q3 (Sep) earnings of $0.56 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus of $0.50; revenues rose 7.0% year/year to $2.35 bln vs the $2.28 bln Capital IQ Consensus.
- System-wide comparable RevPAR increased 1.3 percent on a currency neutral basis for the third quarter compared to the prior year
- Adjusted EBITDA for the third quarter was $524 million, an increase of 11 percent from pro forma Adjusted EBITDA for the third quarter of 2016. Adjusted EBITDA margin was 56.9 percent, an increase of 170 basis points from pro forma Adjusted EBITDA margin for the third quarter of 2016
- Co issues in-line guidance for Q4, sees EPS of $0.41-0.45, excluding non-recurring items, vs. $0.44 Capital IQ Consensus Estimate; System-wide RevPAR is expected to increase between 1.0 percent and 3.0 percent on a comparable and currency neutral basis compared to the fourth quarter of 2016.
- FY18 Guidance
- For 2018, system-wide RevPAR is expected to increase between 1.0 percent and 3.0 percent on a comparable and currency neutral basis compared to 2017. Given Hilton's strong development pipeline, unit growth should continue to accelerate in 2018 as its global system of rooms is expected to expand by approximately 6.5 percent on a net basis.
Praxair beats by $0.06, beats on revs; guides FY17 EPS above consensus (143.62 +0.67)
- Reports Q3 (Sep) earnings of $1.50 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus of $1.44; revenues rose 7.6% year/year to $2.92 bln vs the $2.84 bln Capital IQ Consensus.
- Co issues upside guidance for FY17, sees EPS of $5.78-2.83, excluding transaction costs related to the proposed merger and a pension settlement charge, vs. $5.73 Capital IQ Consensus Estimate.
- Co generated 3Q cash flow from operations of $794 million, 27% of sales. After capital expenditures of $320 million, free cash flow was $474 million, up 15% q/q. The company paid $225 million in dividends and net debt decreased by $202 million.
- "The third quarter extended prior trends with growing demand in North America, Europe and Asia, but continued weakness in South America. Furthermore, our backlog grew to $1.5 billion with the addition of four new long-term on-site supply agreements in the U.S. and Asia. Most of this backlog supports the significant energy and petrochemical expansions in the U.S. Gulf Coast although we continue to see more opportunities in Asia, especially in the electronics end-market.
AmBev beats by BRL0.02; revs slightly below consensus; reaffirms outlook (6.48)
- Reports Q3 EPS of BRL0.20 vs BRL0.18 Capital IQ consensus; revs increased 8.4% YoY to BRL11.36 bln vs BRL11.47 bln consensus
- In Brazil, volumes decline of 4.0% was more than offset by a healthy NR/hl growth of 14.2%. In LAS, volumes were up 4.5% and NR/hl rose by 16.1%. In CAC, NR/hl grew by 6.1% and, while organic volumes were flattish, reported volumes increased by 23.8%, as a result of the swap of assets carried out with ABI and our operations in Panama. And, in Canada, volumes were down 2.9%, affected by a weak industry, with NR/hl declining by 0.7%.
- Outlook
- Co states Brazil, co's largest market, is back on track. Going forward, co expects to continue benefiting from a healthy top line and reduced costs in the country, posting EBITDA growth and margin recovery.
- Regarding our CSD&NANC business, in spite of the temporary pressures during this quarter, co will evolve commercial strategy, pushing ourselves further to improve performance and resume growth.
- In this context, co reiterates guidance that it expects cash COGS in Brazil to be flattish to low single digit up in the second half of 2017
Air Products beats by $0.08, beats on revs; guides Q1 EPS in-line; guides FY18 EPS in-line (154.59)
- Reports Q4 (Sep) earnings of $1.76 per share, $0.08 better than the Capital IQ Consensus of $1.68; revenues rose 13.2% year/year to $2.2 bln vs the $2.12 bln Capital IQ Consensus on nine percent higher volumes, two percent higher pricing, and favorable energy pass-through and currency of one percent each. Volumes were higher in all three Industrial Gas regions.
- Co issues in-line guidance for Q1, sees EPS of $1.60-1.70, excluding non-recurring items, vs. $1.65 Capital IQ Consensus Estimate.
- Co issues in-line guidance for FY18, sees EPS of $6.85-7.05, excluding non-recurring items, vs. $6.91 Capital IQ Consensus Estimate.
- "We continue to be optimistic about the future performance of Air Products and the opportunities we see in front of us. We have the strongest balance sheet in the industry, with over $8 billion available to invest over the next three years. We remain confident in our ability to create shareholder value by deploying this capital through acquisitions, asset buybacks and very large industrial gas projects around the world, driven by demand for more energy, cleaner energy and emerging market growth. We are committed to delivering excellent short-term and long-term performance by improving our adjusted EPS by 10 percent every year, as we have done in the past three years."
Bizzarri on Leadership and Being Gucci
Marco Bizzarri lays out his feel-good management philosophy, which helped Gucci drive revenues up 49 percent last quarter.
Marco Bizzarri is feeling Gucci — and that’s a very good thing.
Although the brand’s sales increase of 49 percent in the third quarter was reason enough to celebrate, the top-line rush might be more effect than cause when it comes to that smiley feeling.
After accepting the WWD Edward Nardoza Honor for CEO Creative Leadership Tuesday night, the Gucci president and chief executive officer gave what amounted to a master class in management the following morning at the WWD CEO Summit.
He started with emotion; recounting a story told to him by a landlord in Taipei, who said his 16-year-old daughter texted friends, “I feel Gucci,” when she wanted to say, “I feel good.”
Bizzarri, who joined the company in 2015, credited creative director Alessandro Michele for the brand’s growing appeal to the younger crowd — also pointing to how six- and nine-year-old brothers Jamison and Hudson Kroenig, sons of model Brad Kroenig, came over to him at the Honors dinner specifically to meet him. But clearly feeling good at Gucci starts at the top and the ceo said he has worked to understand how his 11,000 employees are feeling, to connect with them, to learn from them and empower them to push the brand forward.
While that goes for all of Gucci’s employees, Bizzarri has a special connection to Michele, whose take on the luxe brand has captured the consumer imagination.
“Alessandro is, by very far, my best professional choice,” Bizzarri said. “I could tell you so many stories about how smart I was in choosing Alessandro, but in fact it was completely by chance.”
Michele, who had spent 12 years in design at the brand, was not on the list of candidates for the top design job at the Italian luxury house when it was looking to replace then-creative director Frida Giannini.
“It really just happened, I asked my associate director to tell me one name in the design team that is able to tell me about the processes of Gucci and how we design — it happened to be Alessandro.”
Bizzarri went to Michele’s apartment and, when the designer opened the door wearing fur-lined Gucci loafers (although the brand recently banned fur), he immediately saw something. And he was quickly sold by the way Michele was able to bring together things from the brand’s past and make something new.
“Intuition in this case is superimportant, even more than rationality,” Bizzarri said about choosing Michele as creative director.
The ceo said he respects Michele, not just as a creative talent, but as a person — an approach Bizzarri used earlier as he led Bottega Veneta and Stella McCartney. But having respect for creative talent also means protecting them. The ceo recalled how the initial reviews of Michele’s collections were critical and that “a certain financial paper — The Financial Times” even ran a story with the headline that Gucci’s new strategy wasn’t working after only three months of the duo being on the job. “It takes at least 12 months for results to be seen,” Bizzarri said.
“I’m not a designer,” the ceo said. “They will never be able to do what I do, but I’m sure that I will not be able to do what they do. As soon as I understand that their capability, their creativity is something that is true, is not fake, that could last, then to me it’s very easy. It’s a matter of respecting the person more than the creative talent. I think it becomes very normal. If I have a problem, I call Alessandro…it’s never a fight, we work together.”
That’s Bizzarri’s approach down the line.
“You can craft the best strategy possible, but if the culture doesn’t support you, you will fail, there’s no doubt,” he said.
The brand’s culture also didn’t suit Bizzarri.
“When I joined Gucci, a culture of fear was predominant,” he said.
He said leaders of big companies today have to unlearn what they learned before and listen to keep up because the world is changing too quickly and companies need to operate with cultures that can also shift swiftly.
“It’s not sending an e-mail to 11,000 people and [saying,] ‘You know what, be happy,’” Bizzarri said. “You need to go there, be shaking hands and listen. Show respect and then you can have respect. I would never be able to have the competence of 11,000 people or the brain of 11,000 people, it’s impossible. What I’m asking my people is something that goes to leading by example.”
So Bizzarri meets not just with his executive committee, but also a shadow executive committee that’s made up of people under 30 who tell him what’s working and what’s not and often dives into the same topics the corporate leadership does.
He also has lunches with people who are under 35 and asks them for three ideas on what could be done to improve life at Gucci. Throughout the organization, though, there is the attitude that “‘no’ is not a viable answer” to the question of whether something can be done. “You have to constantly challenge the status quo,” Bizzarri said.
The bad news for other brands looking to grow their topline by 49 percent next quarter is that — beyond connecting the right culture with the right strategy — there is no magic formula to follow.
“If I could go back three years ago, I could easily write a case study about Gucci, how brave we were, how smart we were,” Bizzarri said. “You ask me to do the same thing in another company, I cannot do it. It’s impossible to replicate it. Time is a superimportant variable and momentum is important. At that specific moment, the fashion was a little bit boring. Everybody was doing exactly the same thing. Today, challenge the status quo is the rule. It’s not a choice anymore.”
Of course, that blistering growth sets up Gucci for some difficulty down the line as comparisons grow more difficult.
“Many people are asking me, why don’t you grow less,” Bizzarri said. “And, you know, I tend to be very optimistic in general, I try to see the glass as half full. I’m enjoying the trip so much. I’m not thinking about the next day.”
He said the brand would find some new project or initiative and continue to expand.
“You know, you need to enjoy what you’re doing,” Bizzarri said. “Otherwise, you do bad, you’re bad. You do well, you think tomorrow is going to be bad. At some point, you have to decide what you’re going to do with your life. So smile and enjoy.”
That’s feeling Gucci.
EXCLUSIVE: Chanel Sets Pharrell Williams Sneaker Collaboration for Colette Pop-up
As part of its takeover of the concept store’s first floor, Chanel will launch an Adidas Hu NMD shoe customized by the music star.
As part of its monthlong takeover of the concept store’s first floor, Chanel will launch an Adidas Hu NMD shoe specially customized by Pharrell Williams for the house. Further stoking anticipation, it has yet to release an image of the design, though unofficial photos have been circulating on streetwear feeds.
The music star is featured in the advertising campaign for Chanel’s Gabrielle bag, has walked the runway for the brand and once composed a song for a Lagerfeld-directed Chanel film, but this marks the first time Williams has designed a product for the label.
Other exclusives include limited-edition T-shirts designed by Lagerfeld, creative director of Chanel since 1983, and a music compilation by Michel Gaubert, who designs the soundtracks for its runway shows.
Chanel will take up residency at Colette from Oct. 30 to Nov. 25, and the store will close its doors for good on Dec. 20.
Inspired by Lagerfeld’s Antiquity-themed cruise collection, the decor of its pop-up will consist of a backdrop of draped ecru canvas punctuated by Plexiglas niches showcasing ready-to-wear and accessories.
Items from the fall collection will drop on Oct. 30, with the cruise collection set to follow on Nov. 6. Barrie, the Chanel-owned cashmere specialist, will also be showing a selection of fall knitwear pieces.
The brand is planning a series of happenings through November. Chanel ambassador Caroline de Maigret will deliver a talk on style and allure, while fashion journalist Daphné Hézard will welcome friend of the brand from the worlds of film, literature, music and dance every Tuesday and Thursday for a podcast.
Chanel’s creative makeup and color designer Lucia Pica will host a beauty talk, while other events will include make-up tutorial workshops held every Friday, live-action painting by American graffiti artist Futura 2000 and a showcase concert by the French-Cuban group Ibeyi.
Chanel plans to donate profits from the Colette pop-up to charity organizations supported by the Chanel Foundation, which is dedicated to supporting women as agents of social change throughout the world.
Galeries Lafayette Opens Flagship in Paris Region
The French department store’s new approach to traditional mall flagships included paring down clutter and adding 30-foot-high tree trunks.
PARIS — Galeries Lafayette Wednesday opened its first new store in France in 10 years, offering its latest response to the sector’s search for revival with a forest theme.
“What we wanted to do was to create a store that would be anchored in the forest, in a universe characterized by a lot of vegetation,” said Olivier Bron, Galeries Lafayette, BHV Marais and international director, referring to the shopping center’s rural location with forests nearby. The cluster of 30-foot-tall tree trunks came from a neighboring forest, explained Bron, who said several trees were planted as replacements.
He explained that while many of the new ideas deployed in the store would be implemented in other units around the country, which now number 57, each location would also seek to be anchored locally by offering specific products unavailable elsewhere, for example.
Reducing the number of items on display, the store introduced uniform racks for the men’s and women’s clothing, with areas for different brands distinguished only by discrete and uniform signs, and a few individual touches, like rugs of various designs. The store will sell around 400 brands.
The 65,000 square feet of space spans two floors, in the new wing of the Carré Sénart shopping center south of Paris, an airy space with white-marbled floors with patches of natural light.
Pale, unvarnished wood furniture is scattered throughout the store, used to build a modern space for men’s shoes, meant to evoke a cabin, where square stools are stacked against wooden cubes displaying shoes. Jewelry displays are built of geometric blocks of wood, punctuated by colorful, iridescent plastic panels here and there. A wall in pale pink scales designates space for women, the same in a pale olive green for men.
Dressing rooms are transformed into wide spaces tucked behind walls for added intimacy, with benches inside and outside the space, equipped with outlets to charge phones.
The showroom for luggage merges the digital and physical worlds. A broad wooden table sits in the center, not too high, in order to plop a suitcase onto the felt patch on the surface — that is what it was designed for.
Next to the felt surface is an interactive screen, where the saleswoman can pull up images of other models, broadening the selection of luggage on display, which is limited to two surrounding walls. Another feature on the screen is a list of airlines and their luggage size requirements. The idea is to select an item for home delivery in the coming days.
The store will cater mostly to local clients, in a region with a number of aerospace and engineering companies.
“People have lots of choice, what we want is for people, when they walk out of the door on Saturday afternoon, to say, ‘I’m going start by checking out what’s going on at Galeries Lafayette, after I’ll see, I don’t know if I’ll buy anything, but I want to have a nice time,’” Bron explained. He said he hopes a combination of architecture, low-key events, a regular selection of different brands and animating the store without being aggressive will draw clients.
French real estate company Unibail-Rodamco injected 240 million euros in the shopping center’s expansion, adding more than 300,000 square feet of shopping space in a two-year project.
The center was built in 2002, on fields where beets were grown. The developers originally expected eight million annual visitors, and were surprised by seeing 11 million in the first year. The latest annual figure was 15 million, before the recent works, and the target is for 18 million.
“We said there was good potential here….It’s a place for people in the region to go shopping without having to travel all the way to Paris,” explained Anne-Sophie Sancerre, who heads Unibail-Rodamco’s shopping center activity in France.
“The architecture is very transparent, with clear light that you can see but can’t tell where it’s coming from,” explained the architect, Jean-Paul Viguier, looking up at the tall, cathedral-like ceilings, 39 feet high. He explained that the skylights were built at an angle to diffuse the light, casting it evenly so as not to throw sunlight directly into a shop window.
The white marble flooring, while expensive at the outset, holds up well and brings a chic aura that clients might not necessarily be able to afford for their own homes, explained Sancerre