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INDUSTRY SURVEYS

Apparel & Footwear

SEPTEMBER 2, 1999 / A PPAREL & FOOTWEAR
THIS ISSUE REPLACES THE ONE DATED OCTOBER 1, 1998.
THE NEXT UPDATE OF THIS SURVEY IS SCHEDULED FOR MARCH 2000.

C URRENT E NVIRONMENT ........................................................................................1 I NDUSTRY P ROFILE ........................................................................................................8 Industry Trends . ........................................................................................................... 9 How the Industry Operates . ................................................................................ 13 Key Industry Ratios and Statistics . ................................................................... 18 How to Analyze an Apparel or Footwear Company . ............................... 19

I NDUSTRY R EFERENCES ...........................................................................................23 C OMPARATIVE C OMPANY A NALYSIS ............................................................26

Howard Choe
Apparel & Footwear Analyst

Editor: Eileen M. Bossong-Martines
Copy Editor: Carol A. Wood
Production Coordinators: Li Wah Lai, Susanna Lee, Rose Yung
Statistician: Sally Kathryn Nuttall
Assistant to Editor: Paulette Dixon
Subscriber relations: 1-800-852-1641
Copyright © 1999 by Standard & Poor’s
All rights reserved.
ISSN 0196-4666
USPS No. 517-780
Visit the Standard & Poor’s web site:
http://www.stockinfo.standardpoor.com
STANDARD & POOR’S INDUSTRY SURVEYS is published weekly. Annual subscription: $10,500. Reproduction in whole or in part (including inputting into a computer) prohibited except by permission of S&P. Executive and Editorial Office: Standard & Poor’s, 55 Water Street, New York, NY 10041. Standard & Poor’s is a division of The McGraw-Hill Companies. Officers of The McGraw-Hill Companies, Inc.: Joseph L. Dionne, Chairman; Harold McGraw III, President and Chief Executive Officer; Kenneth M. Vittor, Senior Vice President and General Counsel; Robert J. Bahash, Executive Vice President and Chief Financial Officer; Frank D. Penglase, Senior Vice President, Treasury Operations. Periodicals postage paid at New York, NY 10004. POSTMASTER: Send address changes to INDUSTRY SURVEYS, attention Mail Prep, Standard & Poor’s, 55 Water Street, New York, NY 10041. Information has been obtained by INDUSTRY SURVEYS from sources believed to be reliable. However, because of the possibility of human or mechanical error by our sources, INDUSTRY SURVEYS, or others, INDUSTRY SURVEYS does not guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.

VOLUME 167, NO. 35, SECTION 2
THIS ISSUE OF INDUSTRY SURVEYS INCLUDES 2 SECTIONS.

C URRENT E NVIRONMENT

Overall, the economy was relatively favorable for apparel and footwear manufacturers in the first quarter of 1999. Modest inflation, low unemployment, and the booming stock market contributed to healthy spending

on both apparel and footwear. Apparel and
footwear manufacturers also benefited from
an increase in offshore manufacturing and
favorable prices for raw materials.
The economy continues to provide a
comfortable backdrop for the apparel and
footwear industries. Real gross domestic
product (GDP) was up 4.3% in the first
quarter of 1999 and 2.3% (preliminary) in
the second quarter, after rising 6.0% in the
fourth quarter of 1998. Measures of
consumer attitudes and financial health likewise remained strong in the first half of 1999. The Conference Board’s index of consumer
confidence hit 139.0 (1985=100) in June, the
highest level in more than 30 years, before
dipping a bit to a still-strong 135.6 in July.
Unemployment levels also remained
extremely favorable, dipping to 4.3% in the
first quarter, from 4.4% in the fourth quarter
of 1998 and 4.5%...
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