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Sales up at Moss Bros despite 'tough' market conditions

Like-for-like sales at menswear retailer Moss Bros rose 5.3% to £131.5m for the 52 weeks to 28 January 2017, as its store modernisation programme nears completion.

Like-for-like retail sales were up 6% for the period, while like-for-like hire sales rose 1.5% and now represents 13.7% of total sales.

Ecommerce sales rose 15.7%, representing 11% of total sales. Purchases made on mobiles and tablets showed “strong growth” and now make up 43% of total online sales, Moss Bros said.

EBITDA was up 8.8% year on year to £13.6m.

The retailer also reported an improvement in its gross margin, up 1.5% to 61.3%, as it continued to reduce its levels of discounting.

Moss Bros said the boost in sales could be attributed to ongoing investments in its brand identity and its store refit programme. The company is continuing to roll out its new store format, and completed 11 refits in the last year, while also opening four new stores.

Chief executive Brian Brick said: “The modernisation of the store portfolio is nearing completion and continues to achieve anticipated returns. We have made a good start to the implementation of our omnichannel shopping proposition and will ensure that the appropriate investments are made in both our systems and our people during 2017 and beyond, to leverage the benefits of this important area.

“We continue to add to the capabilities of the management team and we are well placed to accelerate our growth, in spite of continuing tough market conditions and the ongoing headwinds we face as a result of increasing input costs in many areas.”

Chairman Debbie Hewitt also highlighted the challenges the business faces in the year ahead as a result of increasing cost pressures, but noted the retailer’s focus on continuing to build its hire and multichannel offerings.

She said: “In the coming year we will leverage our roll out of ‘Tailor Me’, accelerate the reinvention of our hire offer and leverage and continue to build the infrastructure to modernise our multichannel offer, while investing more in our colleague and service propositions.

“This will be done in the context of significant external cost pressures from the increases in the national living wage, the apprenticeship levy, the revaluation of business rates and increased purchasing costs due to the combined effects of a devalued pound. We expect the trading environment for the business in 2017 to remain challenging.”

Like-for-like sales for the first seven weeks of the new financial year are up 4.3% on last year. However, Easter fell three weeks later in 2017, which temporarily delayed some hire order collections and therefore revenues. Hire orders booked for collection this year are currently down 1% year on year.

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