New Look has revealed plans to upsize its smallest stores from 2016, after its pre-tax profits soared 40.6% to £39.5m for the 26 weeks to September 26.
New Look womenswear autumn 15
The young fashion retailer has identified 15 stores with an average size of 3,000 sq ft that it would like to increase to 7,500 sq ft next year. It did not disclose which units. It also plans to open five new larger-format stores in 2016.
Chief financial officer Mike Iddon told Drapers: “The UK remains the core part of our business. So far we’ve refurbished 120 stores and plan to do this to another 290 next year.
“We’ve seen that in some areas there is the demand for us to be trading from a larger space, so we’ll look to do that.”
New Look’s revenues rose 5.9% to £756m in the first half, helped by “more normalised weather conditions compared to last year”. In the UK, where it has 571 stores, like-for-like sales were up 4.7%.
Chief executive Anders Kristiansen said the sales uplift was driven in large part by ecommerce sales – both on its own website (up 37.9%) and through third-party retailers (up 47.2%) – and the launch of its standalone menswear stores in September.
“We’re investing heavily in our online offering, particularly convenience. We’ve got next day click-and-collect in 40 stores now and we plan to have it in 350 by the end of the year,” he said.
“We’ve also got great online partners in the UK and abroad which helps us test new markets we might want to enter.
New Look made a statutory pre-tax loss of £53.7m in the first half, hit by £93.2m costs from debt repayments and refinancing following its sale to South African billionaire Christo Wiese’s investment vehicle Brait in May. Its new debt structure resulted in annualised interest savings of more than £30m.
Iddon said New Look’s management and Brait are happy with its progress: “Brait is a good owner – it’s a long-term single shareholder and it is very supportive and encouraging of what we’re doing.”
EBITDA climbed 5.1% to £121.7m and underlying operating profit grew 10.9% to £94.8m.