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Exclusive: Investments pay off at AllSaints

allsaints manchester

Operating profit at AllSaints climbed to £3.6m in the 52 weeks to 2 February, compared to a loss of £6.2m in the 53 weeks to 3 February 2018, as investments in its non-retail channels started to bear fruit. 

Gross profit grew 1.8% to £216m in the same period, driven by a reduction in promotional activity during the year. EBITDA before exceptional items was flat at £20.6m, and it narrowed its pre-tax loss from £33m to £26m. 

Revenue was up 1.2% to £331m – AllSaints’ sixth consecutive year of top-line sales growth. The company said it experienced revenue growth in every channel – retail, digital (up 15%) and non-retail, which includes wholesale, franchise and travel (up 40%). 

International sales now represent nearly 50% of total sales. Revenues in the UK, Europe and North America, were flat, while Asia saw a rise of 10% year on year. The strong performance in Asia was attributed to its improved travel retail proposition, as well as continued growth in core retail sales.

There was a £29m charge for non-cash intra-group costs to its parent company Lion Capital, which AllSaints said “reflects the financial accounting treatment common to a venture capital and private equity ownership structure. Some of the shares have preferential treatment, which is accounted for via the finance expense line – and does not affect the performance of the business.”

AllSaints credited several developments for its wider success, including the strengthening of its leadership team. Peter Wood was appointed as CEO in September 2018, having previously been chief operations officer since 2010. He brought former Ted Baker womenswear director Catherine Scorey Jobling on board as COO in January. 

AllSaints has added fragrances and watches to its offer

AllSaints has added fragrances and watches to its offer

AllSaints has added fragrances and watches to its offer

The team has since introduced a new product-focused strategy, which has seen it increase investment in core apparel categories, broaden the footwear and accessories assortment, and launch new lifestyle categories, such as fragrance and watches. 

Meanwhile, AllSaints has increased investment in marketing, which it says is delivering growth in its global audience and engagement.

It has also invested in the strategic development of its non-retail revenue channels in each of its three core markets, building strong relationships with key wholesale, franchise, travel retail and licensing partners. 

In current trading, AllSaints has enjoyed year-on-year sales growth of 15% in the six months to 3 August 2019, driven by like-for-like sales growth of 14%, as well as a 63% year-on-year increase in non-retail revenues. 

“The financial year that ended in February 2019 saw us deliver our sixth consecutive year of top-line growth and a resilient EBITDA performance set against the backdrop of challenging market conditions”, said Wood.

“We are delighted that our focus on product, marketing and distribution has resulted in a significant and sustained step up in our performance since the second half of 2018 which we have further improved on so far in our new financial year.

“It is particularly pleasing that our first half year-on-year sales growth of 15% was achieved via our teams delivering like for like sales growth in every country in which we trade and across every channel in which we operate. This includes our bricks-and-mortar retail stores, concessions and outlets, as well as digital and wholesale, franchise, licensing and travel retail.

“Despite the ongoing challenging market conditions, we believe the strength of our brand, our clear strategic focus, and the quality of our team mean that we are well placed to deliver continued growth in future.”

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