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Weak pound pushes Hackett into the red

British menswear business Hackett made an operating loss of £8.7m for the year to March 31, down from a profit of £995,000 in 2015.

The weak pound and increased discounting hit the firm’s bottom line, and turnover fell 2.4% to £107.4m, while EBITDA fell 41% to £3m.

The menswear business blamed the fall in sales on a slowdown in the European and Middle Eastern wholesale markets.

Meanwhile retail sales were up 12.5%, driven by new store openings at Old Broad Street in London, Bluewater in Kent and Gun Wharf Quays Outlet in Portsmouth.

Online sales showed a “healthy increase” year on year.

The decrease in profit was attributed to the weakness of the pound against the US dollar, the growth of outlet as a proportion of the business and increased markdown.

The business said the impact of the fall in profit was offset by a decrease in operating expenses by 3.9% year on year. The cost of the new stores was offset by reduced marketing spend, sales commissions and third party royalties.

The brand said it will continue to focus on global expansion.

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