London Fog Industries Inc., a leading designer and marketer of rainwear and outerwear, has appointed the head of its casual outerwear division as the next chief executive officer, replacing a turnaround specialist brought in to stem losses and refocus the well-known brand.
The Eldersburg manufacturer of London Fog raincoats and Pacific Trail casual clothes, which also runs 145 company-owned outlet stores, announced the promotion yesterday of William Dragon Jr., 56.
Dragon had served since 1995 as president of Pacific Trail, a Seattle company London Fog acquired in April 1994. In December, Dragon became president of London Fog Industries Trade Group, which comprises all operations but company-owned stores. The CEO appointment became effective Wednesday.
On the same day, Robert E. Gregory Jr. resigned as chairman and CEO and C. William Crain quit as London Fog's president and chief operating officer, the company said. Both are considering other executive positions as turnaround specialists, Gregory said.
The changes at London Fog, which had net sales of $336 million in 1998, come amid a restructuring aimed at focusing on core businesses, cutting costs and securing permanent leadership.
In a statement released yesterday, Gregory said he started discussing the transition in the fall with the board of directors. He was not available for comment.
Dragon credited Gregory and Crain with stemming millions of dollars in losses and putting the company back on track.
In early 1995, Gregory came to London Fog after overseeing the successful turnaround and sale of Gitano Group.
At that time, London Fog's survival was threatened by a $425 million debt, angry retailers and years of management turmoil.
"Rob and Bill were able to stop the major bleeding," Dragon said yesterday from Seattle. "There was a need to put more emphasis on outerwear as opposed to rainwear. Today, we're in a much better financial position."
For fiscal 1998, the company reported net income of $155.7 million, after four straight years of losses, including a $225.4 million loss in fiscal 1995.
London Fog says it has a dominant share of the men's raincoat market in department stores and a significant share of men's outerwear and women's raincoat and outerwear markets in department stores. Products are also sold through specialty retailers, national and regional chains' stores and discount and off-price retailers.
The appointment of a new CEO means that Gregory and Crain have accomplished what they set out to do, said Mark Millman, president of Millman Search Group Inc., a retail consulting firm in Lutherville.
"They took the company to a certain level. They got it out of the previous problems it was entangled in," Millman said. "[Dragon] will continue building the company to its former glory. He has the ability to build an outerwear company. Pacific Trail has been well managed, and obviously he brings a lot to the table in terms of experience and a track record that London Fog desperately needs at this juncture."
The company's Pacific Trail division has benefited from the trend toward casual dressing, although outerwear sales overall were hurt by unseasonably warm fall weather, Dragon said.
Dragon plans to build upon the strong brand recognition of London Fog, which was introduced in 1954 and has grown into one of the best-known apparel brand names in the United States. He also stressed the importance of remaining attuned to consumers.
"We're going to be driven by good intelligence that lets us know what's happening in the market so we can react in a timely fashion, whether product, presentation, promotion or advertising," Dragon said.
Pub Date: 3/12/99