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Licensing Drives Global Brands' Growth

Licensing Drives Global Brands' Growth

Global Brands Group credits its “flexible licensing model” and diverse brand portfolio for top line and margin growth in fiscal year 2017. 

The brand management company also revealed its new three-year plan, which will see the company aim to reach $5 billion in revenue by the end of fiscal 2020.

Global Brands Group credits its “flexible licensing model and diverse brand portfolio" for both top line and margin growth in fiscal year 2017.

For the 12 months ending March 31, the company reported an 11.6 percent increase in revenue (totaling $3.9 billion) and a 64.5 percent in operating profit.

Driven primarilly by growth from new and existing licensees, operating profits in fiscal year 2017 totaled $173 million, up from $105 miillion in fiscal year 2016. 

All four of the companies business vertical reported growth in FY2017. The kids’ category, which remains the company’s largest vertical, posted a revenue increase of 3.9 percent up to $1.6 billion, compared to the same period last year, with category profit up 62.2 percent. The men’s and women’s fashion vertical also saw a revenue increase of 31.5 percent to $820 million year-on-year; and footwear and accessories reported an increase of 5.6 percent to $1.3 billion year-on-year.

The company's fourth vertical, brand management, saw revenue increase by 75.7 percent to $188 million, driven by the formation of the CAA-GBG joint venture in June 2016.

At the same time, GBG unveiled its new three-year plan, which will see the company aim to reach $5 billion in revenue by the end of fiscal 2020. As part of this, GBG intends to consolidate its leadership position as a licensing partner of choice, while making investments in its product and channel capabilities.

“Over the past few years, the industry has experienced dramatic change,” says Bruce Rockowitz, chief executive officer and vice chairman, GBG. “The traditional retail model is no longer sustainable, and success now requires a sophisticated omni-channel strategy. With our flexible licensing model and channel agnostic approach, we see considerable upside in these disruptions, and we are well place to benefit from the resulting structural transformation in the industry to maintain our growth momentum. Global Brands is both the partner of choice and the partner for the future. Our new three-year plan will build on our strong foundation and the growth we have already achieved, consolidating our leading global position for the next three years and beyond.”

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