California Apparel News

Innovo Group Inc. (IGI) is looking to expand its presence in private-label business and move West, said the publicly owned apparel and accessory company, which announced on July 22 the appointment of Samuel J. (Jay) Furrow to chief executive officer.

Furrow succeeds Patricia Anderson-Lasco, who founded the company 15 years ago and will now reassume the role of president. Anderson-Lasco will continue to be based in Knoxville, Tenn., where the company’s Innovo Inc. subsidiary will remain.

Previously, Furrow served as IGI’s president, acting chief financial officer and director, overseeing its financial growth. In his new position, he will be responsible for maintaining the day-to-day operations of the company.

“Growing the company is my main objective,” said Furrow. “My plan is to grow all aspects of the company significantly and expand its presence in private label.”

IGI has three subsidiaries: Innovo Inc., Innovo Azteca Apparel Inc. (IAA) and Joe’s Jeans.

Furrows said the company has been positioning itself to become a major player in the apparel market with Joe’s Jeans and IAA. The former, a high-end contemporary sportswear collection for women, recently introduced a collection for men. IGI also launched Web sites for Joe’s Jeans and Innovo Group.

Now investors on both coasts are giving the company a strong buy rating, anticipating strong sales growth for the year. The company projected that 2002 sales will exceed $25 million, nearly triple the $9 million it reported last year.

However, industry sources say IGI recently emerged from a bleak period, only to have a complete turnaround in profitability. Furrows declined to comment on the company’s previous finances but said the company “needed to increase its revenues, decrease its expenses and obtain profitability.”

In an effort to reorganize, the company entered a strategic partnership with Azteca Productions International, a privately owned denim and sportswear manufacturer based in Commerce, Calif., which manufactures more than 3 million garments per month for such brands as Calvin Klein, Express, Target, Nautica and American Eagle, as well as contemporary branded label Hippie Jeans. IGI purchased Azteca’s knits division and has since acquired a large amount of private-label business, said Furrow.

Azteca owner Paul Guez and his brothers, Hubert and Gerard, own roughly 25 percent of Innovo’s outstanding common stock.

Since the beginning of the partnership, the company has shed more than $1.5 million of debt, and the venture has resulted in a cash infusion of about $1.7 million.

For the past two years the company has conducted most of its business from the West Coast, said Furrows. Last week the company notified its investors that, effective immediately, it has officially changed the location of its corporate headquarters from Knoxville to Commerce, next door to Azteca’s corporate headquarters and production facilities.

Additional growth through acquisitions is also a possibility, said Furrow. —Claudia Figuero