New Look hailed a return profitability in its first half as it continues to push ahead with its CVA and deliver cost reductions.
In the 26 weeks to September 22, the fast fashion retailer reported underlying operating profits of £22.2 million, up significantly from a £10.4 million loss the same period a year earlier.
Its adjusted EBITDA also more than doubled compared to last year, rising from £24.2 million to £49.8 million.
This is despite revenues continuing to fall 4.2 per cent to £656.9 million and like-for-likes dropping 3.7 per cent, though this is a major improvement on the 8.6 per cent decline seen in the previous year.
Its ongoing turnaround plan, following the green light of its CVA back in March, has reportedly already delivered cost savings of £70 million with a further £8 million earmarked.
“I am encouraged by our performance in the first half of the year, which reflects the progress we are making with our ongoing turnaround plans to rebuild our position in the UK womenswear market,” executive chairman Alistair McGeorge said.
“The significant cost savings which have been implemented are delivering improved profitability and we continue to see better performance in our new womenswear ranges.
Last month, New Look announced that it had hired CBRE to oversee its departure from the Chinese market, closing 130 stores that are understood to have lost £37 million last year, which it expects to deliver even more cost savings in the long run.
“The decision to exit our stores in China was a difficult one but was right for the business to ensure we are well positioned for sustainable and profitable growth,” McGeorge said.
“We continue to work hard to accelerate our progress, but we are facing into significant headwinds and uncertainties, including Brexit.
“Clearly the wider retail environment remains challenging and we are not expecting that to change anytime soon.”