Shop Direct’s chief executive has heralded its first annual profits in 10 years as a milestone in the company’s turnaround, with Very singled out as “the one to focus on” in future.
The online and catalogue group, which also includes Isme, K&Co and Littlewoods, reported a pre-tax profit of £6.6m for the 12 months to June 30, a reversal in fortunes compared with the £57.7m loss made in 2012.
While £46.2m of last year’s loss came from exceptional items such as restructuring, redundancies and property write-downs, chief executive Alex Baldock highlighted the 1% growth in this year’s group sales as “evidence of some strong foundations that our future plans are built on”.
He added: “There is a clear growth story here, which is coming from our newer brands Very and Isme. Very is the one to focus on as that is the main growth driver, the one we are investing most heavily in and the one that has delivered a very pleasing performance.”
Sales at Very and Isme were up 18% while Littlewoods and K&Co fell 7%. But Baldock said the company remained committed to the latter two, which had “millions of loyal customers who love them as we do, and who give a very high share of their wallet to them”.
As part of its £100m three-year turnaround plan Shop Direct is ploughing investment into own brand, following the launch of Very sub-brand Definitions in September, which Baldock said had seen a “good response so far”.
He added: “We have a good roster of own brands and have plenty of scope for expansion within those.” The team is also in negotiations to bring in a number of “aspirational” third-party brands, although Baldock declined to name any.