// Matalan revenue drops by colossal 72% as Covid-19 impacts trading
// Matalan ended the quarter with cash of £40.9m, compared with £71.2m the previous year
Matalan has seen its revenue plunge by over 70 per cent, confirming the “severity” of the impact of Covid-19 on trading.
For the 13 weeks to May 30, revenue dropped by 72 per cent to £75.3 million, compared with the same period the previous year.
EBITDA made a loss of £10.2 million in the quarter, after the adoption of accounting standard IFRS 16.
- Matalan announces new chair and chief commercial officer
- Retailers call on government to investigate UK fashion supply chain
This compares with a profit of £50.4 million in same period in the previous year.
The fashion and homewares retailer ended the quarter with cash of £40.9 million, compared with £71.2 million the previous year.
“The results released today reflect the severity of the Covid-19 impact on our business this spring,” Matalan chief executive Jason Hargreaves said.
“The stores were closed throughout most of the first quarter as the UK endured lockdown in what has been without doubt the biggest challenge ever faced by the sector,” he said.
“The scale of revenue lost from our closed stores could not be offset by our smaller online channel, which continued to trade throughout the quarter.
“In response, the business took immediate action to preserve cash, manage working capital and reduce costs in addition to accessing all available government support and drawing down on our revolving credit facilities.
“Liquidity was well managed and resilient, then further supported in June with the successful financing exercise. This positions us well to manage through a period of recovery and adjustment over the coming months.”
Matalan said large and out-of-town stores have been performing strongly since it began reopening its store estate from May 18.
Matalan recently appointed former Dreams chairman Steve Johnson as its new chairman.
Johnson will replace John Mills, who announced in May that he would be stepping down from the board.