Although N Brown insists it is making progress in its turnaround, the clothing retailer reported a steep decline in in annual profits citing difficult market conditions and a pricey shift to a digital-first format.
The chain, which focuses on plus-size and more mature customers, posted a 7.8% drop in pre-tax profits to £72.2m in the year to March 2016, which the FTSE-250 company said reflected exceptional costs “as a result of the closure of our clearance stores, re-organisation costs and VAT related legal and professional fees.”
The group, which owns SimplyBe and JD Williams, did however record a boost to revenues – up 3.5% to £866.2m, while online revenues grew 15% year-on-year.
“It has been a very busy year for N Brown as we continue to transform the way we operate as a fashion retailer – from being mail-order led, to a business that puts digital first,” said CEO Angela Spindler. “We are mid-way through this journey and are delighted to see the benefits coming through, importantly delivering 11% profit growth in the second half of the year.
“Looking forward, whilst we face challenging market conditions for the fashion sector overall, and trading since the year end has been subdued, we remain confident in our ability to make further progress this year. This is based on the strong appeal of our specialist fit proposition, continuous improvement in the customer experience and changes in customer shopping behaviour, driven by targeted marketing.”
N Brown was forced to issue two profit warnings within the space of six months last year, as annual profits fell 21% following unseasonably warm weather and the group transitioned to becoming an e-tailer.