Pentland Group is about to complete a switch from a wholesale distribution mode to a licensing mode for Ellesse. As with Speedo in the USA, the licensing mode has already been successful for Ellesse in Italy, where the brand was born and where the Cisalfa Sport chain has had it under license for the last three to four years. According to a report in the British Drapers magazine, Pentland is also planning to use its large cash pile, last declared at £173 million (€212.5m-$307.3m), to make one or two acquisitions before the end of this year.

Andy Rubin, who runs the Pentland Brands unit of Pentland Group, has been recruiting other top-notch licensees for Ellesse in various other countries in the last few months and is discussing deals with others, without rushing into any quick choices. He wants to make sure that the Ellesse sports brand will be placed at a high level of the market as a symbol of Italian style, offering good margins for the licensees and the retailers.

As previously reported, Pentland has also made a major change in the distribution of Speedo in Europe, switching over from direct sales to contracts with major importers for various regions of the continent. Speedo accounted for about one-half of Pentland Brands’ total wholesale and wholesale-equivalent sales of $1.2 billion last year, thanks largely to the huge revenues obtained by its strong licensing partner in the USA, Warnaco.

As already reported, strong partners have been selected in various parts of Europe for Speedo, whose image is benefiting from the numerous victories obtained over the last few weeks by Michael Phelps and other champions wearing its new high-tech swimsuit, the LZ Racer. Its performance even led Nike to allow some of its own sponsored athletes to wear it.

Similar partnerships are being sought for Ellesse. The licensee designated for the U.K. is the JJB Sports chain, which plans to launch Ellesse for the next Christmas season, but it will not cover Ireland, where there is still a distributor. Another important new partner is the Dutch USG group, which will launch the brand in the Benelux countries in the Spring of 2009.

Also in the Spring, the brand will be launched exclusively in Brazil by Centauro, the country’s largest chain of sporting goods stores. The licensee for the USA is Byron Hero, the former president of Danskin who recently owned for a while Ciesse, the former secondary brand of Fila. UCCAL, one of Nike’s major retail partners in China, is Ellesse’s licensee for that big country, where it already has eight Ellesse shops,

Pentland has signed up a licensee for Ellesse in Croatia, Consul. A contract was signed in Greece and Cyprus with the local distributor of Speedo, Mikis Papakyriakou. Similar synergies among Pentland brands have been developed in countries such as Korea where the local licensee of Ellesse, E-land, has taken on board Berghaus as well.

Rubin is talking to potential partners for the brand in Russia and in Spain, among other territories. France and Germany have yet to be covered, too, but Pentland cannot touch Japan for Ellesse, where the rights to the brand were sold many years ago to Goldwyn. As we have already reported, Rubin has appointed a new brand manager for Ellesse, Richard Newcombe, who had been previously working for Pentland Group’s private label division, which is being phased out.

Rubin declined to disclose the present or projected turnover of Ellesse. After Speedo, the biggest generator of revenues for the British company is its Lacoste footwear license, with sales estimated at more than $350 million for last year. While no specific figures could be obtained, Berghaus was probably next with sales of more than $100 million. Mitre, Brasher, the shoe license for Ted Baker and Kickers’ business in the U.K. are among the other components of Pentland Brands.

Pentland Brands’ wholesale-equivalent sales are almost evenly divided between apparel and footwear. Europe represented 58 percent of the total turnover, North America 26 percent, and the rest of the world the balance. The U.K. now accounts for only about one-quarter of Pentland Brands’ sales, indicating a growing degree of internationalization for the group, which has been traditionally strong only in its own domestic market.

On a wholesale equivalent basis, Pentland Brands’ total revenues increased by about 15 percent last year, but the growth rate is certain to decline this year because of the general economic picture. Company officials would not confirm a report that the company had a £21.2 million profit (€26.0m-$37.7m) on revenues of £391.7 million (€481.0m-$695.8m), probably including royalties on licensees, in a recent unspecified financial year, up by 6 percent from the year before.

Overall, the Pentland Group reportedly made a 56.5 percent higher net profit of £68.4 million (€84.0m-$121.5m) on revenues of £940.9 million (€1,155.5m-$1,671.3m). That includes the results of Pentland Brands and of a variety of other holdings and operations, including the group’s controlling stake in the John David Group, recently renamed JD Sports & Fashion, which according to company executives is being run independently, with no preferential links with the rest of Pentland.

A separate component of Pentland Group is its Hong Kong-based sourcing company, Pentland Asia, but it is being integrated more and more with Pentland Brands’ operations as it has almost completely stopped handling private label contracts with footwear retail chains in the U.K. and the USA. This business had become increasingly marginal, reportedly contributing less than £10 million (€12.3m-$17.8m) annually to the turnover of the group.