Pacific Brands
| Public | |
| Traded as |
|
| Founded | 1985, listed on ASX and NSX in 2004[1] |
| Headquarters | Hartwell, Melbourne, Victoria, Australia |
Key people |
Peter Bush, Chairman David Bortolussi, CEO David Muscat, CFO |
| Revenue |
|
| |
Number of employees | 3500 |
| Subsidiaries | Key brands include Bonds, Sheridan, Berlei, Jockey, Explorer, Tontine and Dunlop Flooring |
| Website |
pacificbrands |
Pacific Brands is an Australian consumer products company that owns a portfolio of iconic brands. The company has come a long way from manufacturing Dunlop bicycle tyres in 1893, becoming Australia's leading underwear and home furnishing company with some of the best loved brands in Australia.
Structure and brands
The company is organised into three operating groups:
- Underwear: which supplies underwear, bras, socks, hosiery babywear, activewear and outerwear categories. Key brands include Bonds, Berlei, Jockey, Explorer, Rio and Holeproof
- Sheridan: which supplies premium bedding products and accessories, towels and other home lifestyle categories primarily under the Sheridan brand
- Tontine and Dunlop Flooring: which comprises a pillow and quilt business with brands Tontine, Dunlopillo, Fairydown, Crestell, Biozone, Dream-a-way and Natures Dreams, and a flooring products business supplying carpet underlay and hard flooring under the Dunlop Flooring and Heartridge brands
History
The company's origins go back to 1893, when Ireland's Dunlop Pneumatic Tyre Company opened a branch office and factory in Melbourne.[2] The branch was sold in 1899 and became a separate company, Dunlop Pneumatic Tyre Company of Australasia Ltd, independent of the original Dunlop company. After several name changes, the Australian company became Pacific Dunlop.[3]
Pacific Brands was formed as a division of the Australian company Pacific Dunlop in 1985. In 2001, Pacific Dunlop sold the division to CVC Asia Pacific and Catalyst Investment Managers, who in 2004 floated the company on the Australian Stock Exchange.[4] The company's stock forms part of the ASX 200 index.
Time line
- 1893 – The Dunlop Pneumatic Tyre Company opened a brand and factory in Melbourne.[5]
- 1915 – Bonds founded by George Alan Bond.[6]
- 1920 – Bonds start producing the Men's Athletic Singlet, also referred to as the Chesty Bond.[7]
- 1929 – Commences manufacturing of footwear with rubber boots.
- 1937 – Entered sporting goods market with the acquisition of Empire Racket Company.[8]
- 1939 – Dunlop Volley invented, inspired by tennis player and Dunlop employee Adrian Quist
- 1960 – Produced Sleepmaker inner spring mattresses.
- 1969 – Entered underwear and socks market with the acquisition of Holeproof and Berlei Hestia Ltd
- 1971 – Created branded footwear business with the acquisition of Grosby.
- 1982 – Acquired Paul Winestock's business, which acted as the catalyst for the company's movement into footwear importing.[9]
- 1985 – Formed Pacific Brands as a consumer goods division of Pacific Dunlop.[10]
- 1987 – Strengthened its position in the underwear and hosiery market with the acquisition of Bonds.[11]
- 1994 – First Sheridan Boutique stores opened in Double Bay and St Ives.
- 1995 – Entered the outerwear market with the purchase of Boydex International Pty Ltd.
- 1997 – Established wholly owned bra manufacturing factory in Indonesia, through the formation of PT Berlei Indonesia.
- 2000 – Developed branded footwear business with the acquisition of the Australian licences for Clarks and Hush Puppies.[12]
- 2000 – Was one of the largest suppliers to the 2000 Sydney Olympic Games.
- 2001 – Acquired Sara Lee Apparel Australia Business (including King Gee, Playtex, Razzamatazz and Stubbies).[13]
- 2002 – Pacific Brands was spun off from Pacific Dunlop and sold to CVC Asia Pacific and Catalyst Investment Managers.[14]
- 2002 – PT Berlei becomes WRAP (Worldwide Responsible Accredited Production) certified.[15]
- 2003 – Acquired Kolotex hosiery[16] and Sachi women's footwear.[17]
- 2004 – Listed on the Australian Stock Exchange and New Zealand Stock Exchange.[18]
- 2005 – Obtained Merrell Footwear distribution licence.[19]
- 2005 – Acquired Sheridan business including Actil and Arthur Ellis (Homewares New Zealand and Everwarm Survival businesses).[20]
- 2006 – Acquired Peri and Foam Products Australia (FPA).[21]
- 2007 – Acquired the streetwear division of Globe International (brands include Mooks, Mossimo, Paul Frank, Superdry and Stussy).[22]
- 2007 – Became a market leader in the workwear category by acquiring the Yakka group of companies (including the Yakka, Hard Yakka, Can't Tear 'Em, Stylecorp, NNT Uniforms, Wrangler and Lee Jeans brands) from the Laidlaw family.[23]
- 2008 – Berlei launched the Barely There bra.
- 2008 – Signed up to the Ethical Trading Initiative (ETI). Pacific Brands is the founding Australian company to join the ETI - a tripartite organisation involving companies, unions and NGOs. The Code is widely acknowledged as a model code of labour practice, and is derived from the Conventions of the International Labour Organisation (ILO).[24]
- 2009 – The Ethical Trading Initiative rated the company as Beginner.
- 2009 – In dealing with the GFC, the company unveiled its new strategy which would see it exit the majority of its local manufacturing and focus on competitive sourcing alternatives offshore. Announced it will lay off 1,850 staff and close most manufacturing sites in Australia, saying they are no longer economically viable.[25] As part of this transformation, the company undertook a capital raising and debt refinancing, raising $165m and refinancing its debt across a range of banks.[26]
- 2009 – Donated in excess of AU $500,000 worth of product to the Salvation Army and in excess of AU $50,000 cash to The Red Cross to assist in dealing with the bushfire crises in Australia at that time. Its staff also volunteered time to assist in the response effort.
- 2010 – The Ethical Trading Initiative increased the company’s rating from Beginner to Improver.
- 2010 – Sold its Chinese Grosby shoe factory, signaling a complete exit from footwear manufacturing. As part of the same deal, it sold its UK footwear business.
- 2010 – Tontine introduced a date-stamped pillow, and suggested that Australians should change their pillows every two years. Research conducted by the brand found that a pillow could grow a complex ecosystem made up of dead skin cells and the things that feed on them. The research also showed there was an average of 9 pillows in every Australian home, with the average age of the oldest pillow being 5.7 years.[27]
- 2011 – Sold its Sleepmaker and Dunlop Foams business to New Zealand company Sleepyhead and sold its Leisure and Fitness business (including Malvern Star Bicycles) to New Zealand's Sheppard Group.[28]
- 2011 – Acquired the Brands United business from Gazal, which comprised 13 underwear and hosiery retail outlets.[29]
- July 2011 – Launched www.sheridan.com.au.
- November 2011 – Launched www.bonds.com.au.[30]
- 2011 – The Ethical Trading Initiative increased the company’s rating from Improver to Achiever.
- 2012 – Volley was the official "dress" shoe of the Australian Olympic Team, who wore a specially designed shoe as part of their uniform during the Opening and Closing ceremonies at the London Olympics. A limited number of the shoes were offered for sale to the public through Big W outlets.[31]
- May 2012 – BONDS opened its first retail store in Westfield Doncaster, Victoria.[32]
- 2013 – Acquired UK corporate clothing company, Incorporatewear Ltd.[33]
- December 2013 – Became a signatory to the Bangladesh Accord.[34]
- 2014 – Sold its Workwear portfolio to Wesfarmers for $180 million. The sale included the brands Stubbies, King Gee and Hard Yakka.[35]
- 2014 – Sold its footwear and sport portfolio (known as "Brand Collective") in three transactions. The sale incorporated Clarks, Hush Puppies, Julius Marlow, Volley, Mossimo, Superdry, Dunlop, Slazenger, Everlast, Grosby, Harrison and Freshjive.
- 2015 – Signed three new brand ambassadors: Iggy Azalea for Bonds, Jessica Marais for Berlei Sensation and a global extension with Serena Williams for Berlei Sport.
- 2015 – Celebrated Bonds 100 year anniversary.
- 2015 – Acquired Crestell pillow and bedding accessories business, encompassing the Crestell, Biozone, Dream-a-way and Natures Dreams brands.
Ethical trading
As a founding Australian member in 2008 of the Ethical Trading Initiative (ETI), which is an independent and internationally recognised code of labour practice, founded on the conventions of the International Labour Organisation, annually discloses its ethical sourcing program to the ETI, including continuous improvement initiatives.[5]
ETI members must adopt their principles of implementation, which set out the approach to ethical trade, including the requirements for companies to demonstrate a clear commitment to integrate ethical trade into their core business practices; to drive ongoing improvements to worker welfare and working conditions, for example through advice and training; and report openly and accurately about their activities.[6]
Since joining the ETI in 2008, Pacific Brands has demonstrated leadership and yearly improvements which has seen its membership status upgraded from Beginner in 2008, to Improver in 2010 and to Achiever in 2011.
Pacific Brands is also a signatory to the Bangladesh Accord and is committed to driving safe working conditions in the country, notwithstanding that the Company does not currently source from Bangladesh.
Controversies
Local manufacturing
Pacific Brands have been criticized by union groups for their decision to move manufacturing overseas. In 2009, the board of Pacific Brands announced the redundancy of 1,850 employees,[7] as part of a plan to move manufacturing operations to China. Union groups protested against the decision.
Human rights
A key obligation for companies under the Ethical Trading Initiative base code is a living wage provision, which states that companies are obliged to pay enough for workers to meet basic needs and to provide some discretionary income.[8] Oxfam Australia has urged Pacific Brands to adopt transparent and independent auditing practices, as an initial step towards ensuring respect for the rights workers in their supply chain.[9]
Executive remuneration
During Morphet's leadership of Pacific Brands, sales had fallen by 15 per cent and net profit by 40 per cent. EPS decreased from 11.5 cents/share to 3.0 cents/share.[10]
In October 2011, Pacific Brands shareholders voiced their disapproval for its remuneration report. There was a backlash from investors due to Pacific Brands bonuses.[11] Although shareholders have had the right to vote on remuneration reports since 2005, the results of the shareholder vote were not binding on the board. Under the new rule, a company will be obliged to hold a spill vote of its board if its remuneration report is not supported by 75% or more shareholders for two years in a row.[12] In the following year, shareholders supported the remuneration report, avoiding a second strike.
References
- ↑ "PACIFIC BRANDS LIMITED (PBG)". ASX. Retrieved 28 July 2014.
- ↑ MCCARTHY, GAVAN. "Dunlop Pneumatic Tyre Company, Australian branch (1893 - 1899)". Encyclopedia of Australian Science. Retrieved 28 July 2014.
- ↑ "Pacific Brands History". Pacific Brands. Retrieved 28 July 2014.
- ↑ "Pacific Brands float debuts at a premium". The Sydney Morning Herald. 2 April 2004. Retrieved 28 July 2014.
- ↑ "Key ETI resources". Ethical Trading. Retrieved 28 July 2014.
- ↑ "About ETI". Ethical Trading. Retrieved 28 July 2014.
- ↑ "Pac Brands suffers loss, set to axe 1850 jobs". The Sydney Morning Herald. 25 February 2009. Retrieved 28 July 2014.
- ↑ "ETI Base Code". International Labour Organisation. Retrieved 28 July 2014.
- ↑ "Talking with Pacific Brands". Oxfam. Retrieved 28 July 2014.
- ↑ Durie, John (24 February 2010). "Sue Morphet's claims for Pacific Brands hard to justify". THE AUSTRALIAN. Retrieved 28 July 2014.
- ↑ Danckert, Sarah (26 October 2011). "Investor backlash over Pacific Brands bonuses". THE AUSTRALIAN. Retrieved 28 July 2014.
- ↑ FRITH, BRYAN (26 October 2011). "GUD, Pacific Brands run foul of rule but this time Transurban nails it". THE AUSTRALIAN. Retrieved 28 July 2014.