Arts and crafts retailer Hobbycraft saw profits plunge in its latest annual results, as its sales also took a hit.
Adjusted EBITDA halved from £10.4m in 2024 to £5.2m for the 52 weeks ended 16 February.
Total sales were down 1.1% to £215.9m from £218.3m the year prior, while the brand’s LFL sales performance declined by 4.3%, compared to 1.1% in 2024. Online sales also dropped 5.7%.
However, the retailer saw gross margin grow from 58.4% to 59% over the period from its own brand expansion.
Hobbycraft noted that its results related to the period before its comprehensive restructuring conducted by its new owners, which was agreed in May 2025.
It highlighted that they showed “subdued underlying trading” amid “the difficult conditions and cost pressures experienced by all retailers in the UK” and demonstrated that its “restructuring and CVA, which resulted in the closure of eighteen loss-making stores, was necessary”.
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Hobbycraft pointed out that despite sales and gross margins remaining “broadly flat,” the business saw “significantly increased operating losses” over the period.
It noted that these rises were largely driven by a “non-cash impairment charge against both the intangible and tangible assets of the business,” as well as “the one-off costs associated with the sale of Hobbycraft to its new owners”.
Hobbycraft CEO Alex Willson said: “These results demonstrate why the restructuring and CVA were necessary to ensure that Hobbycraft can now prosper in the future.
“FY25 was a challenging year for retail in general, marked by subdued consumer sentiment and inflationary cost pressures, and Hobbycraft was not alone in feeling the impacts of this.
“Following a detailed review of the strategy and financial position of the company, in May 2025, we implemented a CVA to improve liquidity and secure the long-term viability of the company and reviewed the store portfolio which had expanded significantly in recent years.”
Willson added: “This resulted in the closure of 18 underperforming stores and a comprehensive cost reduction across the estate.”
“We entered FY26 facing similar market conditions, but the business is now better positioned for the future.”
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