Jan 24, 2018
Reading time
2 minutes
Download the article
Click here to print
Text size
aA+ aA-

N Brown company value plummets as investors take trading update badly

Jan 24, 2018

N Brown saw £130 million being wiped off its market value on Tuesday as investors reacted badly to its trading update. And the share price fall continued on Wednesday, although the drop was less sharp.

Jacamo/Simply Be

The mainly-online retailer had reported rising sales over the Christmas period with a surge for its Simply Be brand and a new e-tail deal with Zalando.

That should have helped the share price higher. But news that margins suffered as the company invested in sales growth was received badly by investors who have been spooked by the overall poor performance in the fashion retail sector in recent months.

The share price fell as much as 18% on Tuesday then dipped over 2% Wednesday, although it recovered a little during the day. The price was 231.4p at Tuesday’s close, having been almost 281p only on Monday. And as recently as last October, it was trading closer to 360p a share.

While the share price might not seem that important to anyone outside the investment community, a falling price does place extra pressure on management at a time when it’s facing a challenging marketplace.

But management, in the form of CEO Angela Spindler, stayed upbeat despite that share price fall, the impact of the Brexit vote, and waning consumer confidence.
She also said after the update was released that the firm remains committed to its 10 physical stores. N Brown had earlier closed five stores and with online sales rising, there has been speculation that it would gradually exit physical retail.

But she said the firm is comfortable with the size of its portfolio and that the stores are important for diving Simply Be and Jacamo brand awareness and sales.

Copyright © 2023 FashionNetwork.com All rights reserved.