Profits at N Brown, the home shopping fashion retailer which specialises in clothes for the fuller figure, have turned anorexic as the company strives to shift its business model from direct mail to digital.
The group, whose brands include Simply Be and Jacamo, saw revenues grow 4.2% to £415.8m but operating profits went south, down14.2% to £38.8m, and statutory pre-tax profits slumped 54.6% to £19.4m. Underlying earnings per share were down 14.5% to 9.9p.
The company blamed the closure of 18 clearance stores for the drop in profits, while underlying profits were also hit by £3m marketing spend allocation for the autumn-winter campaigns landing in the first half rather than the second.
However, the transformation of the business – first revealed nearly four years ago and now spearheaded by chief executive Angela Spindler – is starting to deliver, with online penetration up 5 percentage points to 63% and a strong performance from Simply Be and Jacamo, with product revenue for both up 21%.
Spindler said: “We are pleased with the performance of our power brands. JD Williams delivered an encouraging performance, as the improvements we are making begin to take effect. For example, new customer online penetration increased by 21 percentage points to 74%.”
She claimed that this year will be significantly weighted towards the second half. “It has started well, with a pleasing performance in September, in line with our expectations and underpinning our confidence in the full year outturn.”
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