N Brown sales still down but performance improves
N Brown may have pivoted to an online focus in recent years, but unlike some other pureplay retailers, it didn’t have such a good autumn and Christmas trading season. Yet despite sales falls, there are good signs that it’s on the right track.
Its latest trading update for Q3 — which actually covered the 18 weeks to January 2 — told us group revenue fell 8.8%, which was admittedly better than the 21.9% and 13.4% falls in Q1 and Q2.
In the most recent period, product revenue was down 8.9% (again, better than the falls earlier in the year). And while its ‘other’ brands (Fashion World, Premier Man, House of Bath, Marisota, Oxendales, High & Mighty, and Figleaves) fell 26.1%, its five ‘strategic’ brands were down only 1.4%, raising hopes that they’re a whisker away from seeing a sales increase. Those strategic brands (JD Williams, Simply Be, Ambrose Wilson, Jacamo and Home Essentials) had fallen 25.1% in Q1 and 7.2% in Q2.
It said that product revenue has “continued to recover from the sudden and sharp decline experienced in the first quarter of FY21 caused by the impact of Covid-19. Customer trends in the Q3 period continued to reflect the Covid-19 environment”.
In its core Apparel division, it saw strength in leisurewear and nightwear, although this was offset by a decline in dresses, formalwear and swimwear. It added that Home & Gift sales now comprise 42% of product revenue, compared to 32% in the same period last year.
As mentioned, with its five core brands down only 1.4% in the period, it’s clearly close to getting back to growth in this area. Given that marketing costs were 40% lower, it was actually a strong performance.
And the group said it continues to trade in line with its expectations and expects to deliver FY21 adjusted EBITDA of between £84 million and £86 million.
The company said it was “particularly pleased with” the performance of JD Williams and Home Essentials. Encouragingly, it saw growth in online customer accounts in JD Williams, Simply Be, Jacamo and Home Essentials in the period.
CEO Steve Johnson said: “We remain focused on our number one priority of looking after our colleagues, whilst ensuring the business has the agility to respond to the ever-changing external environment and can continue to serve our loyal customers.
“We continue to move through the acceleration phase of our strategy; simplifying and strengthening our core brand proposition whilst improving our digital capabilities. This is generating continued momentum within the business, despite the difficult macroeconomic backdrop.”
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