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My-Wardrobe posts £3.8m loss as it invests in an ambitious 10 year expansion plan

My-Wardrobe has reported a net loss of £3.8m for the year to June 30, 2011, reflecting significant investment in its infrastructure, including relocating its operation to North London, in preparation for major international and UK expansion.

The main exceptional costs were down to property fees incurred when relocating key functions from Nottingham to London in July 2010 - a total of around £400,000 - and the creation of some new senior management roles.

Despite the overall loss, the company grew its revenue 75% to £12.7m.

Trading EBIDTA stood at £3.1m, up from £1.8m in 2009/10.

A geographical breakdown of year-on-year sales, before returns, showed that the UK had 90% growth. The UK’s average order value of £184 grew 25% on the previous year.

Year-on-year sales in Europe jumped 110%, with an average order value of £189, up 11% on the previous year.

Sales across the rest of the world were up 120%. Rest of world average order values grew 34% to £219.

Sarah Curran, Founder and chief executive of my-wardrobe.com, said: “In line with the investment taken on, we relocated to a new London Headquarters to facilitate the relocation of the Nottingham-based studio and editorial functions to London.  With the increased studio size and a move to a larger Nottingham fulfilment centre, as well as increased  team resources across all key departments, we have been able to provide a robust fulfilment platform creating a 10 year growth infrastructure.   

“This investment reflects the company’s confidence in its future growth plans and this confidence is shared with our shareholder base.  We could not  have fulfilled the continued growth, especially with that of the international sales growth, without making this step change in capacity. Our trading performance since last July has proved that this investment was necessary to enable the performance and underpin the future growth of the business.” 

Bringing on board new brands including Marc by Marc Jacobs, 3.1 Phillip Lim for autumn 11 and Burberry Brit and Issa for spring 12 had helped push up AOV growth.

My-Wardrobe said it was taking steps to reduce reliance on the UK market, introducing plans for international expansion.

Drapers reported in January that My-Wardrobe.com was to launch internationally last month. The refreshed site now offers localised language and currency options for a number of international markets in Scandinavia. This is to be be followed by Australia and the Middle East.

A round of funding with existing investors last September raised £2.3m to support infrastructure development. The company expects this will help provide sufficient working capital and help it reach profitability in the short-term.

Tight cost control will help the company reach profitability in the short-term and be cash generative, it said in a statement.

My-Wardrobe is expected to announce a chief executive to take over from founder Sarah Curran in the next couple of months. The new boss will focus on global expansion while Curran turns her attention to user experience, creative direction and further development of the brand and the website.

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