Simply Be and JD Wiliams owner N Brown Group this week reports a 7.6% decline in third-quarter group revenues as its customers took a more cautious approach to spending in an inflationary economy in the run up to Christmas.
The pureplay fashion and homewares retailer says group revenues came in at £249.2m in the 18 weeks to December 31 2022. That’s 7.6% down on the same time last year. Revenues from its strategic brands – which include Jacamo alongside Simply Be and JD Williams, came in at £120.9m – a fall of 5.5% on last time. There was a bigger, 17.6%, decline in sales at its heritage brands, which are in managed declined and turned over £45.5m in the quarter. Heritage brands include Ambrose Wilson, Home Essentials, Fashion World, Marisota, Oxendales and Premier Man.
The retailer says returns rates and credit arrears are now back to pre-pandemic levels. N Brown Group is paying £49.5m to insurer Allianz to settle a dispute regarding payment protection insurance, but says after that it will still have net cash of about £30m and access to lending totalling almost £200m.
Looking ahead, it says it expects its fourth quarter to be softer than its third quarter, and that full-year adjusted earnings before interest, tax and one-off costs (EBITDA) will come in at around market expectations of £57.5m. It says it will need to manage costs and profit margins tightly in its next, 2024, financial year while continue to invest for strategic change.
Steve Johnson, N Brown Group chief executive, says: “We have traded in line with our expectations through a challenging period, as customers continue to be more cautious with their discretionary spending in the face of the various, well-documented consumer pressures.
“Although we are cautious about the macro environment over the next 12 months, we remain confident in the resilience of our business and in the strategic investments which we are making for the long term.
“With many returning to festive activities for the first time in three years, we’re proud of the role which we played in helping our customers look and feel amazing during Christmas.”
SimplyBe is a Top100 retailer in RXUK Top500 research while JD Williams and Jacamo are both ranked Top150.