The Works has posted a 58% jump in adjusted EBITDA to £9.5m for the year to 4 May 2025, as its turnaround strategy delivers a sharp uplift in underlying profits.
The value retailer, said profit before tax rose 20.3% to £8.3m while like-for-like sales increased 0.8%, outperforming the wider non-food retail market.
Store sales – which account for over 90% of total revenue – climbed 2.3% on a like-for-like basis, offsetting a 12.1% drop in online sales, which were impacted by capacity constraints at its third-party provider during peak trading.
Total revenue fell 2% to £277m, reflecting the impact of an additional trading week the previous year.
The business said it delivered a “strong performance” in the fourth quarter, with like-for-like sales up 6.4%, driven by continued improvements in product availability, store standards and customer-focused events.
It credited the profit uplift to product margin gains – up 210bps year on year – and ongoing cost-saving measures, with further annualised savings of over £2m identified for FY26.
The Works launched its new ‘Elevating The Works’ strategy in January, focusing on growing brand fame, improving customer convenience, and becoming a leaner, more efficient operator.
During the year, it opened seven stores, closed 15, and relocated four, ending the year with 503 stores – down from 511 – but with a “higher quality and more profitable” estate.
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Chief executive Gavin Peck said: “We are delighted to have ended FY25 in line with recently upgraded market expectations in a year defined by ongoing uncertainty and fragile consumer confidence. This encouraging performance is a huge credit to the early success of our new strategy launched in January 2025, ‘Elevating the Works’, which is already delivering tangible results.”
The positive momentum has continued into FY26, with like-for-like sales up 5% in the first 11 weeks of the new financial year. The retailer said it is “comfortable” with upgraded market forecasts of £11m in adjusted EBITDA for FY26.
Peck added: “Guided by our new strategy, we are focusing our efforts on becoming the favourite destination for affordable, screen-free activities for the whole family. This has significant relevance, particularly in a digital age when customers are looking for ways to connect and spend their time away from screens.
“The strong trading delivered post-Christmas has continued into the start of our new financial year, with customers clearly loving our new Spring and Summer product ranges. This positive momentum, guided by our transformative strategy and energised team, leaves us well placed for further strategic and financial progress in FY26.”
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