Operating profit at Dune fell 21% to £3.5m for the year to 26 January 2019 as a result of the woes of key concession partner House of Fraser.
Profit before tax dropped 9% to £3.04m as the footwear brand suffered a £1.2m debt write-off arising from HoF’s administration in 2018.
Turnover fell 4% to £143m. Dune reported a gross profit of £86.1m, down 3.6% on the previous year. The brand achieved positive like-for-like sales growth through all distribution channels, with the exception of HoF. Its own-website sales grew by 13%.
Dune opened six outlet stores and five concessions in department stores during the period. It closed seven stores.
Kate Ormrod, lead retail analyst at GlobalData, said: ‘‘Dune’s performance disappoints, with the retailer falling foul of squeezed consumer budgets and discounting on the high street, resulting in a 0.1 percentage point loss of UK footwear market share in 2018 to 1.7%.”
“Also selling via Debenhams’ stores, and the department store operator having its own set of problems rivalling those of House of Fraser, the footwear specialist remains on shaky ground in FY2019/20, especially as the lack of Brexit clarity continues to impact consumer spending.
“Dune’s double-digit rise in online revenue is a testament to its ongoing investment to enhance its digital proposition, refining the user experience to exploit consumer appetite for online shopping. Its delivery saver scheme sets its offer apart from the likes of Kurt Geiger; however, its core fulfilment offer is in need of investment, particularly its delivery timeframes, as it lags behind its third-party partners such as Next.
“With the footwear specialist channel forecast to be the worst-performing in the sector over the next five years, Dune must boost appeal via differentiated ranges and emphasise its quality and service credentials to showcase value for money and drive repeat visits and purchases. The relaunch of its trend-led Head Over Heels brand in March 2019 will help it tap into the lucrative, but competitive, 16-to-24-year-old segment.”