Bendon's Elle is to take on Cool Britannia

Friday 1st June 2001

EXPANDING BRAND: Managing director Hugo Venter (above) says Bendon has chosen the UK market because it is more similar to New Zealand than others. At left, supermodel Elle Macpherson will be closely involved with the UK expansion of the brand that bears her name

By Deborah Hill Cone

Listed lingerie designer Bendon said yesterday it will make a bold expansion move into the UK in early September.

It will launch its Elle Macpherson brand into top department stores including Selfridges and House of Fraser - the first time it has taken its product outside Australia and New Zealand.

It hopes to capitalise on the woes of Marks & Spencer, which has lost share in the lingerie category - dropping from 40% of the UK market to about 30% - potentially leaving a hole for another brand to pick up.

Managing director Hugo Venter said Bendon chose the UK market because it was more similar to New Zealand than other countries. Bendon has formed an alliance with London-based SR Gent to handle the logistics of moving into the UK, as well as forming partnerships with media company Rocket and PR firm Purple.

Supermodel Elle Macpherson would be closely involved with the UK expansion of the brand which bears her name, Mr Venter said.

So far the foray into the UK had cost $1.2 million.

He predicted it would take two and a half years before the UK venture would start to show a positive effect on the company's balance sheet.

Bendon announced a before-tax profit of $5.3 million on turnover of $78 million. That compared with turnover of $77.8 million the previous year.

Australian revenue was down from $43.5 million in 2000 to $41 million this year.

Mr Venter said the Australian market was tough and Bendon had been hammered by a downturn following the Olympics, discounting at major department stores and the introduction of GST.

For example, if a consumer usually spent $100 on lingerie, after GST was introduced they would still spend the same amount and only $90 of that would be passed on as revenue.

Mr Venter said major department stores in Australia had been sitting on excess stock, which led them to making big markdowns. Bendon had chosen not to take part in that because it would prefer to sacrifice some turnover in order to maintain its margins.

As part of its transformation from Ceramco into Bendon Group, focusing on lingerie design, the company has sold its China Clays division.

After the sale the company cancelled one in every four shares, resulting in 10 million shares being cancelled and $16.3 million being returned to shareholders.

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