Menswear group Moss Bros is to axe jobs after pre-tax losses widened to £3.3m over the six months to July 31 - but it said current trading was encouraging.
The group would not reveal how many of its 1,500 staff will go, but job losses are expected to number in the low tens and to focus on its head office and its distribution centre, which is moving from a seven-day to a five-day week.
The group recorded sales of £65.6m, a rise of 7.9% while pre-tax losses increased from £3m during the same period the year before. EBITDA dropped to £126m from £643m.
Moss Bros attributed the losses to a number of reasons including changes in the senior management team and two major store refits during which the stores were closed, losing £500,000 of trade.
Moss Bros chief executive officer Brian Brick said the company is reviewing its business operating model to help reduce the costs.
“Having made good progress on driving top line growth we are now turning our attention to costs and a comprehensive review of the cost base of the business is underway. This will help simplify the business operating model and provide resilience against potential impact of any reduction in consumer spending.”
He added: “Whilst the early response to the autumn/winter range is positive, with like-for-like sales continuing to improve, we remain in a period with tough economic conditions and consumer uncertainty.
“With this in mind we are managing the business to reflect these conditions, ensuring we continue the momentum of the turnaround. We remain on track to meet the board’s expectations for the full year. ”
Like-for-like sales in the first half increased 11.6%. Gross margin dropped 0.5% to 55.5% in the first six months.
During the past six months the group has appointed Robin Piggott as finance director, replacing Michael Hitchcock. Debbie Hewitt was appointed chairman.
The group launched Moss Bespoke in May and is exploring ways to roll this out, including in other Moss Bros stores and with other retailers.