Operating profit at River Island reduced by 56.4% to £35.1m in the 52 weeks to 29 December 2018, following continued investment in product, technology and service.
The retailer also opened four new stores and relocated nine shops during the period.
River Island also reported a 3% decrease in revenue to £919.7m. Meanwhile, net assets at the company increased by 9.9% to £187.1m.
It comes after Drapers revealed in June that current River Island CEO Ben Lewis is stepping aside after nine years in the role and will remain on the board of River Island as non-executive director. It has appointed the former chief executive of The White Company, Will Kernan, as its new CEO.
“Despite challenging market conditions, we have maintained our long-term vision to build a resilient business and maintain our unrelenting focus on our customers and their fashion needs”, Lewis commented. “We are seeing continued growth online and with our wholesale partners, and we remain committed to retaining a store presence on the high street, all of which we see as key areas to support growth for the future.
“However, we are also experiencing a decrease in profitability and increased cost pressures on our business. Quite simply, it is more expensive to maintain our level of service to our customers and we have to work harder just to stand still. As we evolve and adapt to our customers’ ever-changing needs, we will continue to invest for the long term in important areas such as product, technology, stores, service and our people.”
He added: “This is my last set of results as CEO and I very much look forward to continuing to support River Island as a non-executive director. I am proud to step aside leaving a robust business and a talented team in place. Over the past 30 years, River Island has been one of the best-loved names on the high street and online, and we are confident that this will continue.”