Group sales at N Brown Group in the 18 weeks to 5 January fell 1.6% year on year, in a “challenging” and “highly promotional” market.
Product sales dropped 6% on 2017/18. “Power brands” remained stable – down 0.1% – and secondary brands fell 5.2%, while traditional brands plummeting 22.9%. The business said it continued to scale back its expenditure on offline marketing and recruitment during the period.
Product revenues at Simply Be and Jacamo were up 1.6% and 5.5% respectively, and by 5.9% and 6.8% for online only. JD Williams declined 3.3%. For online sales only, JD Williams was ahead by 6.9%. The group said it is currently re-evaluating its proposition for JD Williams and will provide further details at its full year results later in the year.
Sales from financial services for the period were up 9.7% on last year.
Online product sales increased 1.3% year on year, while power brands were up by 6.4%. The group’s digital sales now account for 78.5% of product revenue compared to 71.0% for the same period last year.
N Brown said that despite the highly promotional retail environment, the group is maintaining its product gross margin guidance at between 0 and -100 basis points for the full year.
The group said it began to stabilise its international performance. Revenue was down by 5% as it began to “better re-engage with its target customer base.”
Chief executive Steve Johnson said: “The group delivered robust online power brand growth and a stable margin performance in what was a challenging and highly promotional peak trading period. We continue to manage the anticipated decline of our legacy offline business and remain focused on improving our customer proposition to drive profitable online growth. Trading over the cyber and Christmas periods was relatively consistent and in line with our expectations, with the group benefiting from a more targeted and efficient approach to its promotional activity.
“Based on maintained margin guidance, continued strong financial services performance and improved operating efficiency, our full year expectations remain unchanged.”