N Brown annual revenues decline 0.8 percent

Revenue at N Brown Group Plc declined 0.8 percent to 914.4 million pounds (1,193 million dollars) with product revenue declining 5.6 percent offset by a 10.8 percent increase in financial services revenue for the year to March 2, 2019. The company said, product revenue was 615.8 million pounds (803 million dollars), reflecting a continued shift in focus from legacy offline business to digital growth, the ongoing challenging market conditions for fashion retail and the closure of store portfolio. Excluding stores, which are all now closed, product revenue was down 4.2 percent, while financial services revenue was 298.6 million pounds (389.6 million dollars).

Commenting on the company’s full year trading, Steve Johnson, N Brown’s Chief Executive, said in a statement: “We’re pleased to have delivered a solid trading performance for the year, driving a 7.9 percent increase in adjusted EBITDA, as we continue our transformation into a digital retailer. Encouragingly, we saw digital revenue growth across JD Williams, Simply Be and Jacamo, as we improve our customer offer whilst managing the decline of our legacy offline business.”

Highlights of N Brown’s full year results

Product category performance, N Brown said, was impacted by the managed decline of the offline business and the closure of stores in the year. Ladieswear declined as a result of lower sales in branded ladies clothing. Both menswear and footwear & accessories also declined largely due to Premier Man. The company added that home & gifts performance was principally due to lower revenue at House of Bath.

The Group’s gross margin was 54.4 percent, down 40bps compared to FY18 due to a 10bps decline in the product gross margin to 52.1 percent and a 200bps decline in the financial services margin to 59.2 percent. Adjusted EBITDA increased by 7.9 percent to 128 million pounds (167 million dollars), with adjusted EBITDA margin increasing by 1.1ppts to 14 percent. Overall, operating profit before exceptional items was 97.9 million pounds (127.7 million dollars), up 8.2 percent year on year, with operating margin increasing by 0.9ppts to 10.7 percent.

Adjusted profit before tax was 83.6 million pounds (109 million dollars), up 2.5 percent. Statutory loss before tax was 57.5 million pounds (75 million dollars), while loss per share from continuing operations was 20.50 p against FY18 earnings per share of 4.41p. Adjusted earnings per share from continuing operations were 21.38p compared to 23.06 p in FY18.

The company’s board has recommended a final dividend of 7.1p per share.

Picture:N Brown via MHP