Versace Posts ’03 Loss As Young Allegra Beck Begins Learning Curve

Versace’s annual meeting saw the debut of Allegra Versace Beck as major shareholder and the repayment of its $123 million bond.

The U.S. showed overall weakness, caused by the appreciation of the euro against the dollar. “We tried to contain a rise in prices, so that the currency fluctuations would not be passed on to the market,” said Ballestrazzi, noting the company had at times dropped prices by from 5 to 15 percent.

Ballestrazzi said Versace is completing the merger of Alias, which produces all apparel for the Versace and Versace Sport collections, among others, and Diver, which produces its leather goods and footwear. Alias and Diver will be merged into Versace SpA starting Sept. 1. “This is a way to simplify and centralize the company’s structure and avoid the bureaucratic side of intercorporate activities, a way to reorganize the workflow across rather than vertically,” said Ballestrazzi, noting that production was previously split among five different factories. The merger will be marked by the opening of a new state-of-the-art plant in Novara. Employees will be reallocated and not let go, he noted.

Ballestrazzi also said Versace was pleased with an “exceptional sell-through of the women’s collections for spring-summer 2004 — a 37 percent growth.” Orders for fall-winter 2004 also grew 20 percent.

“The results of a single, integrated collection, abandoning the concept of a pre- and main collection, and available two months ahead, will be fully evident in 2005,” he predicted.

— With contributions by Alessandra Ilari
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