29th Aug 2007 07:00
Hot Tuna (International) plc29 August 2007 Press Release 29 August 2007 Hot Tuna (International) PLC ("Hot Tuna" or "the Group") Strategic Review Hot Tuna (International) PLC (AIM:HTT), a lifestyle apparel brand with authenticsurf heritage, is pleased to give the following information on the strategicreview which has now been completed by Niels Juul, who joined the Group as ChiefExecutive on 1 June 2007. The strategic review has spanned the whole breadth of the Group and has resultedin the implementation of several important changes in order to drive growth insales and continue Hot Tuna's development. Organisational structure Following the strategic review, the Group has been restructured, which hasstrengthened the team across all levels of the business, in order to build amore effective operational structure. The administrative and logisticalfunctions were previously spread throughout the Group's operations, and thesefunctions have now been brought together in one location. There has also been a shift in focus for the senior management team, whose roleshave been redefined to incorporate more of a sales function rather than theirprevious operational focus. This realigned structure will put Hot Tuna in astrong position to continue its development and to realise the future strategyfor the Group. Manufacturing and production The review has also assessed the manufacturing process which has beenstreamlined by reducing the Group's reliance on 14 manufacturers to just three.Whereas previously materials were obtained from numerous sources across fourcountries, the Group will now use a maximum of three sources based solely inChina, which will give much quicker delivery times and more reliability.Significantly, the move to fewer sources will place the Group in a strongerposition to negotiate better prices for larger orders, and therefore securebetter margins. The Group's strategy with regard to production is to purchase large quantitiesof plain garments from a single source, and then to customise them regionally toreflect local tastes and styles. Design and sampling process The strategic review has highlighted inefficiencies in certain elements of theexisting design and sampling process, which the Board has addressed by targetingthe opening of a new sourcing office in Shanghai by the end of September, toservice the needs of the entire Group. There will be cost savings as a resultof the fact that the sampling process will be contained in one location, ratherthan incurring the costs of spreading the process globally. The design process will be similarly streamlined, as the designers will berelocating to the Los Angeles office to allow Niels Juul and Executive DirectorElle Macpherson to oversee all aspects of the design process. It is anticipatedthat these changes will reduce the overall design time by a total of six toeight weeks, which is significant not only in terms of reducing the cost of theprocess, but also as it will secure more orders by offering a quicker time tomarket. Delivery The Shanghai sourcing office will enable much quicker delivery time, and willalso reduce the risk of delay, as deliveries will be shipped directly fromShanghai to their destination. This new method of design, sampling and delivery will be implemented from thebeginning of the design of the Autumn/Winter 2008 collection, which commencesnow, although certain elements of the new set up will be used for thosecollections which are already in progress. Commenting on the review, Ranjit Murugason, Executive Chairman of Hot Tuna,said: "The changes that Niels has implemented have been extremely positive forHot Tuna both as a brand and as a business; his creative vision and sharpbusiness acumen have meant that he has made the whole Group more efficient inthe way that it functions, whilst maintaining the strength of the Hot Tunabrand. "The Board's focus on the Group's 'time and action calendar' will give tighterdeadlines and ensure that the whole process is simplified and has clear targets." Niels Juul, CEO of Hot Tuna, commented: "I have been focused on improving theGroup's margins by reviewing and adapting the processes that were already inplace. We have identified a number of areas which need to be addressed, and thenext phase of my role will be to realise these changes for the benefit of theGroup. "Our production process has been simplified, offering significant cost savingsand a much more efficient function. The restructuring of the Group and itsoperations will create a more efficient streamlined apparel operation, and thissecure structure will facilitate our growth going forward." - Ends - For further information:Hot Tuna (International) PLCRanjit Murugason, Chairman Tel: +44 (0) 20 7372 9378ranjit_murugason@hottunaplc.com www.hottunaplc.com Seymour Pierce LimitedMark Percy / Parimal Kumar Tel: +44 (0) 20 7107 8000parimalkumar@seymourpierce.com www.seymourpierce.com Media enquiries:AbchurchHenry Harrison-Topham / Chris Lane Tel: +44 (0) 20 7398 7700chris.lane@abchurch-group.com www.abchurch-group.com Notes to Editors Hot Tuna International PLC (AIM:HTT) owns the rights to the Hot Tuna brand, aprogenitor of global youth fashion, born in Australia with a heritage ofauthentic surf culture. Hot Tuna is one of the world's most iconic names in surf lifestyle and can traceits roots back to 1969 when it was founded by a surfer and his fashion designerwife. Though the label had not been actively marketed over for the lastdecade, it retained an organic cult status among core action sports enthusiasts. In June 2005, Hot Tuna International PLC purchased the 'Hot Tuna' brand fromFrontier International (Holdings) Pty Ltd, listed on AIM in September 2005, andhas since started to aggressively market the brand and reinvigorate thebusiness. The Company now owns all intellectual property rights to its name andrelated iconography, and has put in place key management drawn from theexecutive ranks of Von Dutch, Quiksilver, O'Neill and Ocean Pacific, amongothers. Headquartered in the UK, Hot Tuna operates design, marketing and distributionhubs in the USA, Australia and the UK. In its core markets, Hot Tuna sellsproducts, which are directly manufactured in facilities principally in China. Hot Tuna offices are maintained in Sydney, Los Angeles and London. For moreinformation, visit www.hottunaplc.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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