New Look has been hit with a double-digit drop in like-for-like sales in its first quarter, although it insists its business restructure was continuing to bear fruit.
For the 13 week period ending June 29, the fashion retailer recorded a 10.1 per cent fall in core like-for-like sales compared with a year earlier, which it blamed on lower footfall from unseasonably bad weather in May and June along with consumer uncertainty.
However, New Look said there was already improvement in trading performance for second quarter, with like-for-like sales up 2.2 per cent.
New Look also said its statutory loss before tax had improved by £12.8 million to £2.7 million, mostly due to the implementation of comprehensive refinancing in May. The refinancing saw long-term debt significantly reduced from £1.35 billion to £350 million and an addition of £150 million of new long-term capital.
Elsewhere in New Look’s quarterly trading update, total revenue dropped from £300.6 million this time last year to £258.3 million, and adjusted EBITDA dropped to £23.5 million compared to £33 million last year.
New Look executive chairman Alistair McGeorge said a key focus during the first quarter was to conclude the comprehensive financial restructuring, which he said was “successfully completed” and secured the retailer’s long-term future.
He added that trading “was marked by continued consumer uncertainty and, being a seasonal business, we were clearly not immune from what has been the most unseasonable May and June on record, impacting footfall across the retail sector.”
“Despite these challenges, we maintained good control of our stock, cash position and costs. I am pleased our recent trading shows that we have delivered positive like-for-like sales performance and we have outperformed the market according to the BRC, which underlines our continued confidence.
“With our restructuring now complete, we have been able to start investing in our leadership and people, and I was delighted to welcome Nigel Oddy as chief operating officer in April, in addition to four highly experienced board members. “Furthermore, we now have a chief customer officer in place and have more changes to come.”
Source: Retail Gazette