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New Look sales and profit plummet

New Look’s underlying profit slumped by 60.3% to £12.1m for the first quarter of the year, from £30.5m during the same quarter last year.

Adjusted EBITDA also plunged by 37.3% to £27.2m in the 13 weeks to 24 June 2017, from £43.4m.

New Look said this was driven by a “challenging UK sales performance and investment in strategic initiatives”.

The retailer’s revenue fell by 4.4% to £338.7m, while like-for-like sales in the UK declined by 7.5%.

Its own-website sales dipped by 0.6%. However, third party e-commerce sales grew 15.7%.

It made a loss after tax of £15.2m, compared with profit after tax of £5.8m in the same quarter last year.

New Look chief executive Anders Kristiansen said: “As expected, the UK market has remained difficult, which has resulted in a disappointing quarter of trading. We have managed the business accordingly by controlling costs, tactical investment in our strategic initiatives and enhancing our product proposition.

“We remain committed to our long-term strategy of diversifying the business and reducing our dependence on the UK high street, and are confident that we will see improvements, but expect these to take time.”

“Looking ahead, we expect the consumer economy to remain fragile and challenging market conditions to persist into 2018. We will continue to manage our business prudently and focus on providing our customers with exceptional product and real value for money.”

Kristiansen added that the retailer is encouraged by continued expansion in China, where it opened another 17 stores, to take total store count in the region to 127.

It is also trialling a new store concept in the UK.

Readers' comments (2)

  • This makes dismal reading. If this is the result after controlling costs imagine if they hadn't controlled costs! New Look has got everything wrong - product, price, customer proposition- as the online sales also decreased in a growing pure play market. If the customer isn't shopping their product online that says a lot. What's happened since Brain SA bought it? The strategy started 2 years ago is clearly not working.

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  • Complacency and a focus on China. Starts at the top.

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