Fast fashion womenswear brand Quiz has issued a fresh profit warning following a “significant shortfall in sales” in the first two months of 2019.
Online sales rose 16.2% year on year in the two months to 28 February 2019, but store and concession sales slumped 11.1%. Overall group revenue was down 1.7%.
Quiz previously forecast revenue for the year to 31 March 2019 at £133m. However, it now anticipates revenues in the region of £129m.
It said the increased level of discounting would have a “material impact” on gross margins generated in the final quarter.
The board now anticipates that group EBITDA will be in the region of £4.5m for the full year, down 45% on 2018.
Tarak Ramzan, chief executive officer at Quiz, said: “While the board remains confident in the strength and appeal of the Quiz brand, as demonstrated by our continued sales growth online, this has been a highly disappointing trading period for the group.
“As a result, the board will be reviewing all aspects of the business over the coming months to ensure that we can deliver the group’s long-term potential, despite the changing consumer backdrop and challenging trading conditions.”
Quiz had net cash of £8.9m as at 5 March 2019, and said inventory “continues to be carefully managed”, with current stock levels similar to the previous year.