Donatella’s New Day: ‘Stronger’ Than Ever As Business Revamps

Feeling better than ever, Donatella Versace, who spent six weeks in rehab this summer for drug-related issues, was in London to promote her latest fragrance.

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Versace is trying to get back in the black after seeing its 2003 net loss swell to 26.5 million euros, or $32 million, from a loss of 5.8 million euros, or $7 million, in 2002. Sales slid 16.6 percent in 2003 to 403 million euros, or $487.2 million. Dollar figures have been converted from euros at exchange rates current when the figures were reported in late August. No figures have been released for the company’s performance so far in 2004.

Versace said she wants to see women wearing her clothes, which is why she toned down the mood this season and opted for a low-key approach — low-key, of course, being a relative concept.

“It was a more mature collection, it was for the market, for the real world. And I took a softer approach. The fabrics were softer, lighter, more liquid. Instead of the zippers and accessories, there were lots of small details like piping, gold trim, stitching, special draping and pleating. One of the silk dresses was held together only by a knot in the front. It was as if the clothes were laid bare on the runway. There was nothing loud about them. They’re not overdone,” she said.

The company, too, is undergoing major changes. At the top of the list remains the plan to sell a minority stake in the business to an outside investor. While no deal has been struck, the company continues to say it hopes to complete a transaction by the end of the year.

As reported, Versace is cutting costs, merging similar operations such as corporate communications and advertising to boost efficiencies, striking more licensing and franchising deals and speeding up product development and deliveries. The company plans to refocus and rename the secondary lines under a new label, and revamp the licensed Versace Jeans Couture for spring. Donatella Versace, however, declined to go into detail about the changes, and said announcements would be made in November.

The company is also interested in selling its watch and beauty businesses, according to industry sources. At least one of the deals is expected to take place by the end of the year, although Versace declined to comment.
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