Plus-size sales a great fit for N Brown, US expansion a “priority”
Continued positive trading” is how specialist fit retailer N Brown summed up its first half performance Thursday morning.
There was also talk of gained market share in the UK retailer’s trading update, supported by news of new partnerships to sell capsule collections online with Amazon Fashion for Simply Be and Jacamo brands, with Namshi (Simply Be) and with Debenhams (Jacamo).
It also said the US will have “first priority” status in its expanding international ambitions, a fledging market that saw H1 sales rise over 6%. There were no details, but watch this space.
Results for the 26 weeks to September 2 saw product revenue rise 7.5% to £325.5m, while financial service revenue inched up 1.1% to £129.9m. That meant group revenue overall lifted 5.6% to £453.4m.
N Brown’s Power Brands starred with revenues up 14.3% and active customers up 7.5%, excluding Fifty Plus, or by 5.9% included.
JD Williams brand revenue rose 12.1% while Fifty Plus fell 5.2% with the company saying that the brand’s migration into the more successful JD Williams is now complete. Its Simply Be plus-size label leapt 21% and menswear brand Jacamo lifted 6.7%.
Overall womenswear revenue rose 9.5% with a 90bps increase in market share for size 16+. Further new third-party brands were added including Levi’s, Mango, Oasis, Tommy Hilfiger and Ugg.
Online revenues jumped 14% overall while Power Brands online-specific revenues rose 21% with online penetration 4ppts higher at 72%.
Some 76% of all traffic came from mobile devices and within this, smartphone sessions increased 54% and now account for over half of all traffic. It said smartphone conversions remain “encouragingly above the industry average… the conversion rate for smartphones specifically exceeded 4% for the first time.”
However, it wasn’t all good news. Adjusted pre-tax trading profit rose just 1.8% year-on-year to £32.2m in spite of the strong sales performance. Statutory loss for H1 was £27.6m, although this includes previously-announced exceptional costs of £54.9m and legacy issues. Net debt also rose 7% to £305.7m.
Product gross margin also fell 190bps on-year to 54%, due to currency headwinds affecting the cost of goods sold.
Meanwhile, revenue from its store estate slipped to £10.6m from £11.5m a year ago. At the end of the first half it had 18 stores, (10 dual Simply Be/Jacamo stores and eight High & Mighty stores) following several closures.
It had earlier announced the closure of five dual fascia Simply Be/Jacamo stores (now completed) as a result of weak high-street footfall, together with significant higher costs for some stores as property taxes rise, it said.
CEO Angela Spindler said: “I am very pleased to report continued good trading in the half, with Simply Be the standout performer. We made significant ladieswear market share gains against what remains a subdued consumer backdrop. In line with other retailers, FX rates represent a headwind and this was particularly felt this half.”
Looking ahead, the company expects top announce further new partnership deals to boost UK sales. This includes selling capsule ranges on other retailers’ websites and also sees a “significant growth opportunity” in influencer marketing by “working together with bloggers and opinion formers to improve brand cut-through and further strengthen customer engagement.”
The company is also stepping up its marketing investment to drive new customer recruitment.