Shop Direct profits accelerate for the third year

Shop Direct having digital department stores such as Very.co.uk, Littlewoods.com and VeryExclusive.co.uk under its fold announced a third consecutive year of record profits for the financial year ending June 30, 2015. Profits increased by 78 percent to 71.7 million pounds (109.9 million dollars).

Commenting on the results, Alex Baldock, Group CEO said, “This has been a big year for Shop Direct. Very.co.uk and mobile have been the outstanding performers for us. We’re working hard to keep our lead in m-commerce, and Very is now the UK’s fastest growing department store. We passed some important milestones last year. We called time on the catalogue, and we are now a pureplay retailer dedicated to digital. We’ve transformed quickly to this more focused business – only three years ago, nearly three-quarters of our sales were from catalogue customers.”

Third consecutive profitable year

The company said that profit surge was driven by sales growth and a successful move to being a 100 percent digital retailer, while it managed better discipline across selling, costs and credit risk.

Group sales increased 3 percent to 1.8 billion pounds (2.7 billion dollars) compared to 1.7 billion pounds (2.6 billion dollars), last year. Very.co.uk delivered sales growth of 21.1percent with more than 850 million pounds (1,304 million dollars) in sales and its mobile device sales surged 51 percent.

Wide variety and digital strength key to profits

Very.co.uk is the UK’s fastest growing department store with a wide line-up of famous brands. The platform boasts of 1,100 famous brands and 70,000 lines on offer across clothing, footwear, electrical, home, furniture and seasonal categories, which includes gifts, beauty and toys. Over 180 new brands including River Island, Sonos, Miss Selfridge and Bang & Olufsen were introduced to the customers.

The company has also made considerable investment in Big Data, which it says is now paying back. It has the capacity to conduct 100 tests a month in a custom-built user experience lab. The company also diverted its energies on Very.co.uk and Littlewoods.com after the closure of Woolworths, Isme and K&Co during the year.

The launch of VeryExclusive.co.uk in February 2015 was announced dedicated to luxury fashion, which retails over 150 high street luxury labels such as Vivienne Westwood, Marc by Marc Jacobs and Reiss. New labels have been added for A/W15 like LK Bennett, Kenzo and Paul Smith.

“Four months in, we’ve made a strong start to the new financial year too. We’re in good shape for the peak Christmas period, and we expect growth, discipline and transformation to drive another record year. The competition is ferocious so we must and will continue to invest heavily in our digital future, and keep up the pace on our transformation. These are exciting times for Shop Direct,” concluded Baldock.