Retailer Results / N Brown

16/06/2016

N Brown

Trading Update
13 weeks to 28 May 2016

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21/01/2016

N Brown

Trading Update
18 week period to 2 January 2016

Highlights

• Group revenue +4.1 per cent
• LFL +4.1 per cent
• Product revenue +4.3 per cent
• Financial services revenue +3.7 per cent
• On track to meet full year expectations

• Online penetration up 5ppts year-on-year to 66 per cent, with online sales up 13 per cent.
• 75 per cent of new customer demand was generated online during the period, up 7ppts year-on-year.
• Power Brands active customer file growth of 12 per cent and total file growth of 1 per cent.
• Digital brands Simply Be and Jacamo performed strongly, both recording double-digit year-on-year growth
• JD Williams brand also performed well, with revenue up double-digit year-on-year; JD Williams group of titles overall marginally positive, diluted by performance of traditional brands
• Good performance over the Christmas trading period

Summary

The JD Williams group of titles overall saw marginally positive product revenue growth. There remains a notable divergence in performance between the core JD Williams brand (JD Williams, Simply Be and Jacamo), which has undergone a comprehensive modernisation and is generating strong results, and the traditional brands Ambrose Wilson and Fifty Plus. The core JD Williams brand achieved double-digit revenue growth in the period, driven by the improved product offering, strong PR activity and the Autumn Winter digital-first marketing campaigns. The traditional brands Ambrose Wilson and Fifty Plus saw revenue declines of high single-digits.

Simply Be achieved low double-digit revenue growth year-on-year and management remain confident of the continued long-term opportunity for the brand, both in the UK and globally. New Autumn ranges, particularly Simply Be Unique and Coast were very well received by customers.

Jacamo also saw double-digit revenue growth, driven by the continued success of own-label, together with innovative digital content which resonated well with target customers.

At the category level, Ladieswear saw moderate growth, a solid result against the challenging market backdrop. Menswear recorded mid single-digit revenue growth year-on-year, driven by Jacamo. Homewares was the best performing category during the period, up high single-digit, driven by Furniture, Home Textiles and Beauty.

Overall, online penetration increased 5ppts year-on-year to 66 per cent, with total online sales up 13 per cent. 75 per cent of new customer demand was generated online during the period, up 7ppts. Order frequency and units per basket both recorded positive year-on-year growth, whilst average selling price was flat. Conversion and abandonment rates improved further, both overall and across each device type. During the period mobile devices generated 68 per cent of all traffic, up 10ppts year-on-year.

Simply Be USA continued to perform well; in the period growth of +28 per cent was achieved in turnover year-on-year, or 20 per cent on a constant currency basis. The new International web platform is going live in mid-2016.

Whilst stores remain a small part of the group overall, the performance was disappointing, with sales flat on a LFL basis year-on-year. In line with the wider retail sector, footfall was weaker, and this was the primary cause of the muted sales performance, with conversion in store up year-on-year. Continued focus is on the ongoing efficiency and profitability of the store estate.

Angela Spindler, CEO, commented: "We are pleased with our performance in Q3, during which we saw clear evidence of the benefits of the way in which we are transforming the business. After the well-documented difficult start to the season for our sector, our more agile approach enabled us to trade the business well and we delivered particularly good results over the cyber weekend and in the weeks that followed. This was driven by our improved product offering, which continues to gain traction with customers, together with our new digital marketing initiatives.

"Simply Be and Jacamo continue to show strong growth, and the potential of these brands is significant. We are also very pleased with the double-digit revenue growth in the JD Williams brand which is testament to the hard work over the past few years, and we are excited about the further potential of the online 50-plus fashion market.

"Our digital-first strategy has continued to make good progress and I am encouraged by the transformation underway in the business. We are on track to meet full year expectations, and we move into 2016 with real energy and confidence in our future."


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