Karen Millen is attempting to bolster its bottom line with a full-price strategy following a drop in EBITDA over the last year.
The womenswear retailer has increased its level of full-price sales for autumn 13, with 97% of the range sold at full price compared with 88% at this time last year.
Chief financial officer Andrew Ware said: “We have been trying to restrict our promotional activity since the back end of the summer and have resisted the temptation to go into Sale early. We are as optimistic as we can be in the run-up to Christmas but it’s a battlefield out there.”
The retailer’s anti-discounting strategy will continue into the next calendar year. “We are trying to switch Karen Millen from being a high street brand to being a bridge brand,” said Ware. “It is key to our strategy going forward that we do this in all markets and all channels.”
Karen Millen has created a new logo and introduced more separates over the past 18 months, as it undergoes a refresh amid speculation about a possible management buyout (MBO), led by chief executive Mike Shearwood, following the business being spun off from its former parent company Aurora Fashions in 2011.
Although Ware could not comment on specific details surrounding the potential MBO, he said: “We are doing so much at the moment, we are focusing on doing a lot of operational improvements and are very focused on creating shareholder value, whoever those shareholders might be.”
This week Karen Millen revealed its EBITDA for the year to March 2 had declined to £13.5m from £15m as it invested £2m into “people, processes and technology”. Despite opening 35 stores in the year sales were flat at £260m.
The chain has also set out plans for global expansion, with 65% of sales now coming from outside the UK. Further expansion in Karen Millen’s largest markets – the US, Middle East and Russia – is planned and a flagship store on New York’s Fifth Avenue is scheduled for next spring.
It is also looking to open 25 to 30 stores over the next year across Southeast Asia and South America through franchise partners.
“In the UK it is about reviewing [stores], we will probably do some refitting and location,” said Ware. “We will inevitably change the shape of the portfolio over time and we will want to have some larger, more experiential stores.”