Sports footwear retailer Footasylum has issued a profit warning for 2019, despite seeing an 18.5% revenue rise to £98.6m for the six months to 25 August 2018.
The business expects to report a small EBITDA loss for the six month period, with an additional £2m in exceptional income as a result of the closure of one of its Birmingham stores. For the full year to February 2019, Footasylum warned it now expects EBITDA to be “significantly lower” than the previous year, at less than half of the previous £12.5m figure.
The announcement was blamed on challenging high street performance during July and August, with strong sales in wholesale and online sales offset by “disappointing” in-store sales and delays in the company’s scheduled store openings and upsizes.
Commenting on the results, Barry Bown, executive chairman of Footasylum, said: “These are undoubtedly challenging times in the retail industry and, in common with many other businesses, Footasylum’s trading has continued to be impacted by weak consumer sentiment. On top of that, increased clearance in stores has led to a reduction in gross margin, and we have also had some unforeseen delays in our new store openings and upsizes.
“However, we have continued our programme of investment, both in upsizing our stores and in our digital capabilities, and are working hard on a number of initiatives to maximise the company’s performance during the upcoming peak trading period.”