Book and craft retailer The Works has reported improved profitability and resilient in-store trading in its interim results.

The business said, for the 26 weeks ended 2 November 2025, total like-for-like (LFL) sales increased by 0.3%, underpinned by a strong performance in stores, which account for more than 90% of group revenue.

Store LFL sales rose 4%, significantly ahead of the wider UK non-food retail market, which recorded growth of 0.6% over the same period.

Total revenue edged down 0.3% year on year to £123.8m, reflecting the timing of store openings and closures, as well as a sharp decline in online sales.

E-commerce revenue fell 36% following operational disruption linked to the transition to a new third-party fulfilment partner.

Despite the online headwinds, profitability improved year on year and adjusted EBITDA losses narrowed to £1m from £2.8m, while the adjusted loss before tax reduced to £5.1m from £6.5m.

The improvement was driven by strong store LFL growth, product margin expansion of 330 basis points and ongoing cost saving initiatives, partially offset by external cost pressures. Net debt also reduced to £5.3m, down from £8.5m a year earlier.

Trading in the first 11 weeks of the second half, covering the key Christmas period to 18 January 2026, was reported as being in line with board expectations.

Store LFL sales increased by 1.2%, outperforming a wider non-food retail market decline of 0.4%, supported by demand for value-led family activities and a strong response to Black Friday promotions, said the retailer.

CEO Gavin Peck said: “The strategic initiatives delivered in the first half of the financial year have been critical in driving a strong performance in-store and an improvement in profitability year-on-year.

“Along with the wider sector, we have felt the impact of a challenging consumer backdrop, however we continued to see a positive response to our excellent value and new products over the festive period.”

Online sales remained heavily constrained, with LFL sales down 51.8% due to continued fulfilment challenges, resulting in total LFL sales declining 4.2% over the period. The group said that as peak volumes have eased, the year-on-year online sales decline has begun to reduce, with work ongoing alongside its fulfilment partner to address the issues.

The business said the results mark further progress against the ‘Elevating The Works’ strategy, centred on positioning the business as the UK’s leading destination for affordable, screen-free activities.

During the first half, the retailer invested in brand marketing focused on encouraging families to spend quality time together, while launching new products across all categories to drive year-round relevance.

Operationally, the business continued to improve store standards and consistency across the estate. The Works added a net two stores during the period, with seven openings, five closures and one relocation, and remains on track to add a net five stores in FY26.

Efficiency initiatives also progressed, including sustained product margin growth and improved distribution centre productivity following investment in a new mezzanine level. The group reiterated its target to deliver £2m of cost savings in FY26.

Peck added: “Guided by our strategy, alongside the hard work of our colleagues and support of our loyal customers, we are well-positioned to deliver sales and profit growth in the remainder of the financial year and beyond.”

Looking ahead, business said it remains on track to deliver full-year results in line with market expectations.

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