Quiz this week almost halved its full-year profit forecast as customers held back on spending in store and it then discounted more than it had expected in order to clear stock. Sales fell in store but rose online as a result.
The multichannel fast fashion retailer, which trades from stores and concessions in the UK and Europe and also sells online, said in a trading update that its online sales had risen by 16.2% in the period from January 1 to February 28. But sales in its more than 250 UK stores and concessions were down by 11.1% at the same time.
Quiz chief executive Tarak Ramzan said: “While the board remains confident in the strength and appeal of the Quiz brand, as demonstrated by our continued sales growth online, this has been a highly disappointing trading period for the group. As a result, the board will be reviewing all aspects of the business over the coming months to ensure that we can deliver the group’s long-term potential despite the changing consumer backdrop and challenging trading conditions."
The trading update was issued as Quiz, a Top150 retailer in IRUK Top500 research, approaches the end of its financial year on March 31, and the company said that it was now downgrading its full-year expectations. Previous forecasts anticipated that full-year sales would come in at £133m - 9.2% up on the previous year – and that expected earnings before interest, tax and asset writedowns would come in at £8.2m. In yesterday’s update it said that sales would now come in at about £129m - hitting profits that were now expected to come in at about £4.5m in the full year.
The retailer said it would now undertake “a thorough review of all aspects of the business with a view to mitigating the effects of changing trading conditions.” It expects to report its findings when it publishes full-year results in June 2019.
Image courtesy of Quiz