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Losses mount at LK Bennett as Topp implements turnaround plan

LK Bennett made an operating loss of £4.5m for the year to 30 July 2016, up from a £1.1m loss the year before, as CEO Darren Topp implements his turnaround strategy to refocus the business.

Turnover edged down 1% for the year to £92.3m, while gross profit was down 2% to £58.3m.

Like-for-like sales for the year were up 1%, driven by online sales growth of 19%.

Online sales in the UK were up 18% compared with 2015 and were up 35% in the US. Meanwhile, wholesale sales rose by 2.3% as a result of growth in the US, the Middle East and Asia.

During the year, four loss-making stores in the UK were closed and concessions were opened in John Lewis and Harrods.

The retailer plans on opening up to 40 doors per year for the next three years, most of which will be in the UK. This financial year it launched in China, Russia and Qatar for the first time.

Non-executive chairman Patrick Woodall said he was pleased with the results in a “very challenging market”. He added that on current trading, like-for-like sales were up 6% as LK Bennett approaches its 2016/2017 year-end.

In September 2016 Darren Topp, former CEO of BHS, joined the business in the same role and conducted an in-depth review of the firm. The growth plan has focused the business back to founder Linda Bennett’s original vision of delivering “affordable luxury”.

The retailer plans to strengthen the design, buying and merchandising teams, and Bennett has rejoined the firm one day a week to focus on product design. LK Bennett plans on branching into new categories, including swimwear and jewellery, and will stretch its price points to appeal to a broader customer base.

The directors said they were confident that the execution of the growth plan, along with close control of costs and changes to key business processes, would return the group to profitability.

Readers' comments (1)

  • Another top(p) performance?

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