***UPDATED***Mike Shearwood has been appointed chief executive of Aurora Fashions.
Shearwood, formerly deputy chief executive, has replaced Derek Lovelock, who has become executive chairman.
Aurora, the group behind chains Karen Millen, Coast, Oasis and Warehouse, said that it had annual global sales of circa £720m and net debt of about £110m. The group said it was “strongly cash generative”.
The group, which operates from 1,427 stores in 45 countries including the UK, said that “its performance at the end of the first half was significantly ahead of bank plan as set out at Aurora’s inception in March 2009 and the group is well positioned for future growth”.
“The business is in great shape, morale in the teams is high and we have an excellent supply base and strong relationships with our retail and business partners. We know the brands have great potential and we have plans to develop them further, something that I am personally going to concentrate on in my new role.”
Derek Lovelock, executive chairman Aurora Fashions
The retailer, which was formed out of the adminsitration of Mosaic in March, added that margins had been impacted in the first half due to currency fluctuations and the loss of its forward hedging facility at the time of the administration of backer, nationalised Icelandic bank Kaupthing.
It added that it had negotiated a new hedging facility with Barclays and has “substantial” forward cover. Group stock levels “have remained clean throughout the period”, the retailer added.
The group has been the subject of scrutiny since the administration of Mosaic, which was part-owned by Baugur as well as Kaupthing. In recent weeks, Aurora has been forced to insist that speculation that there might be a sale or break-up of the group is unfounded.
Shearwood, who joined Mosaic in September 2007 from Inditex where he was UK managing director, said: “This is a very exciting time to take the helm at Aurora. We have achieved a great deal in the last six months and I’m very much looking forward to working with our teams, our retail and business partners and our suppliers to build on our recent success and to drive our future growth and expansion through all sales channels in both domestic and international markets.”
Lovelock, who joined Oasis Stores in 1999 as chief executive ahead of completing an MBO of Oasis in 2001 which became Mosaic, will focus on strategy, exploring development opportunities and supporting the brands on product, sourcing and supply chain. He said: “The business is in great shape, morale in the teams is high and we have an excellent supply base and strong relationships with our retail and business partners. We know the brands have great potential and we have plans to develop them further, something that I am personally going to concentrate on in my new role.”
In the first half, the group opened 137 outlets, 110 in overseas markets. In the UK the retailer opened 27 outlets including six standalone stores and 21 concessions in department stores including John Lewis, House of Fraser and Debenhams. It plans to open a further 18 UK concessions and eight standalone stores in the next six months, taking its total number of UK outlets to 863.
Internationally, 78 out of the 100 stores are company owned and 32 are franchise stores. New openings include the launch of Karen Millen in Spain with two new standalone stores and 15 concessions in El Corte Ingles department stores.
The retailer will open two standalone stores in Chicago and Seattle for Karen Millen, taking its total store numbers in the US to 14. It will open 25 more outlets overseas in the remainder of the year.
Ecommerce sales rose 20% at the group on last year and the chain’s sites now deliver to 26 international markets.
In a statement, Aurora added: “This is an exciting time for Aurora and the group has made much progress over its first six months. It is well-placed to face the furture, with robust finances and a strong balance sheet.”
It added that it was “confident of delivering further growth in what remains a difficult domestic market”.
Non-executive chairman Stewart Binnie will remain on the board as president and senior non-executive.