Analysis

PEAK 2017 Fast fashion? Christmas updates from Quiz, Superdry, Moss Bros, FatFace, Ted Baker and Footasylum

UK fashion retailers showed mixed results as they updated the markets on trading in the run up to Christmas and over the festive season. Here we round up their latest reports.

Quiz: boost from omnichannel

The Top 100 fast fashion retailer said its omnichannel model had helped it to meet expectations, with sales over the Christmas period up by 31.9% in the seven weeks to January 6. Its performance, it said “reflects continued good growth across the group’s omnichannel business model as well as increasing awareness of the Quiz brand.” Ecommerce revenue grew by 119% over the period, with sales performing strongly both via its own websites and via third party online retailers. Quiz [IRDX RQUI] said its growth was enabled by its 2017 investment in its distribution centre. International sales also grew, by 51.1%, following openings in Spain and growth in Ireland, and the retailer opened its fifth new UK store of the year in Bristol’s Cribbs Causeway.

Chief executive Tarak Ramzan said the retailer was pleased with the strong momentum of the period. “This growth reflects the strength of our brand and the appeal of our products to customers who want the latest looks at fantastic value,” he said. “We are continuing to execute our growth plans in each area of the business, underpinned by continued investment in our marketing, people and infrastructure. We continue to look forward with confidence as we build on our strategy to develop QUIZ as a global fast-fashion brand.”

Superdry: strong ecommerce sales as customers move online

Superdry [IRDX RSGR] reported strong online sales (+35%) as global brand revenue grew to £314.4m in the 10 weeks to January 6, a rise of 13.6% year-on-year, while group revenue was 12.6% higher at £215.6m. Retail sales were up by 4.7% and wholesale by 20.4%.

The retailer said the performance reflected the consumer’s continued move to buy online. This, it said in half-year results, demanded “ever greater focus and innovation on our in-stre consumer experience.”

Chief executive Euan Sutherland said it had “further strengthened its position as a global digital brand obsessed with quality and design.” He added: “Our growth through our eight channels to market has further diversified the brand, both geographically and across channels, while continued innovation has further widened our product offer.”

Moss Bros: hit by ‘tough’ December on the high street

The formalwear hire and retail business said retail accounted for 90% of group sales in the 23 weeks to January 6. Retail sales grew by 1.6% in the period, while overall sales were up by 1.1%. Like-for-like [LFL] retail sales grew by 0.4%, buoyed by a strong online performance, with ecommerce sales growing by 12.3% to account for just under 13% of group sales. Hire sales, however, fell by 3.6% LFL.

Moss Bros [IRDX RMOS], a Top100 retailer in IRUK Top500 research, said it had avoided deep discounting by tightly controlling the amount of stock it bought for the autumn/winter season.

Chief executive Brian Brick said that while it had made “considerable progress” in building a cash generating and profitable menswear business that has outperformed the market, it had been hit by a “very tough December trading environment, which led to a significant reduction in store footfall and a hardening of the corresponding competitive environment in which we operate”. He said full-year sales and profits were likely to fall short of expectations as a result.

He added: “In common with many UK retailers, the year ahead looks like being an extremely challenging one, not least because of the uncertain consumer environment, wider political backdrop and significant cost headwinds we face from a weaker pound, business rates and increasing employee related costs. However, we have a strong consumer proposition and our ambition remains to be the first choice for men’s tailoring and we are determined to ensure that we continue to invest in this proposition to protect our position.

“We see the weaker environment as an opportunity to strengthen our core brand proposition and to utilise our strong balance sheet credentials to invest. Whilst this will inevitably impact anticipated profits for FY2018/19, we do believe continued investment is essential to ensure we retain a sustainable point of differentiation and that we leverage our niche position on the high street.”

Boohoo.com and PrettyLittleThing: best Black Friday yet

Top150 retail brands and stablemates Boohoo.com and PrettyLittleThing both reported record results in a period that included Boohoo’s best Black Friday yet.

“The Black Friday period was our most successful ever and we traded well throughout the period under review,” said joint chief executives Mahmud Kamani and Carol Kane. They said they would continue to focus on the customer proposition, and offering “the best range of the latest fashion at affordable prices, coupled with great customer service”.

Group revenues grew by 100% in the four months to December 31, with sales at boohoo.com up by 25% to £142.6m, and revenues at PrettyLittleThing up by 191% to £73.8m.

FatFace: keeping sales full-price

The fashion brand, a Top150 retailer in IRUK Top500 research, reported a 12% rise in total sales, which reached £120m in the 26 weeks to December 2 with online sales up by 27% to account for 18% of overall sales. In In the five weeks to January 6 they grew by 12% with online sales up by 24%. Fat Face’s biggest ever week came in the week of December 30.

During the half-year Fat Face launched a new online platform and website and opened a new distribution centre in Havant.

Chief executive Anthony Thompson said FatFace had a great first half and outperformed the market without cutting prices. It decided not to open 40 of its 228 stores on Boxing Day, giving staff the day off.

He said: “Our trading performance over the Christmas period has been strong on all fronts. We continue to believe that giving our customers price integrity before the big day has been central to this performance.”

Ted Baker: strong online growth

The lifestyle brand, a Top250 retailer in IRUK Top500 research, said retail sales grew by 9% in the eight weeks to January 6, with online sales up by 35% – to account for 30.1% of total retail sales. Ted Baker [IRDX RTED] also said that it had expanded its store network, opening a new owned store in Montreal and concessions in Germany and Spain.

Founder Ray Kelvin said: “The Ted Baker brand has continued to perform in line with expectations over the Christmas period, delivering a good retail performance driven by particularly strong growth from ecommerce, which is an increasingly important part of our retail business. This pleasing result reflects the strength of the brand and the quality of our collections as well as the hard work, skill and commitment of our teams.

“Whilst external trading conditions are expected to remain challenging in the year ahead, the strength of our brand and business model means that we remain well positioned to continue the long-term development of Ted Baker as a global lifestyle brand.”

Footasylum:

Shoe retailer Footasylum, ranked Top50 in IRUK Top500 research, turned in revenues of £89.8m in the 18 weeks to December 30 – a rise of 33.4% on the same time in the previous year.

Store, ecommerce and wholesale sales all grew during the period, maintaining growth of 34/7% in the 44 weeks to the same date.

Mentioned in this piece…

Quiz Clothing

Quiz Clothing

IRDX: RQUI

Quiz is a dynamic fast fashion retail group that focuses on delivering catwalk style looks and all the latest trends at value for money prices. (more…)

Superdry

Superdry

IRDX: RSGR

Superdry is a UK fashion retailer offering branded clothing and accessories. It operates a multichannel business through a combination of Cult and Superdry standalone stores, Superdry concessions, ecommerce and its UK and international wholesale operations. (more…)

Moss Bros

Moss Bros

IRDX: RMOS

Moss Bros is one of the UK’s oldest menswear retailers, specialising in dress wear for formal occasions. Moss Bros has over 150 stores throughout the United Kingdom. (more…)

Ted Baker

Ted Baker

IRDX: RTED

Ted Baker is a British clothing retail company.
Ted Baker plc is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
Ted Baker’s managing director, Ray Kelvin, started his first store in March 1988 in Glasgow, and opened further stores in Manchester, Plymouth, and Nottingham. (more…)

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