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Shop Direct to launch Very overseas as it cuts group losses

Shop Direct is to launch Very overseas as it cuts group losses to £7.8m over the past year.

From next month, the company is beginning the phased launch of its young fashion brand’s website in the US and 47 other countries.

Over the 61 weeks to June 30 – the retailer changed its financial year to fit with its key trading seasons - EBITDA under UK GAAP declined 13% to £116m which the group said was a result of additional investment in its brands, increased promotions and its part-absorption of inflation costs.

Group sales grew 5.5% to £1.9bn and it cut pre-tax losses under UK GAAP to £7.8m from £21m year-on-year.

The retailer said it has seen a “marked slowdown” in consumer confidence and spending since its year end and predicts a tough year ahead.

Shop Direct Group chief executive Mark Newton-Jones said: “We don’t believe the environment will become any easier in the foreseeable future and, as such, we are budgeting for a tough year ahead whilst continuing to invest in areas for future growth.”

Newton-Jones said he was pleased with sales growth in what had been “a tough year for all retailers”.

It said it had faced significant inflationary pressure from rising VAT, cost of goods and shipping.

During the period its online sales grew 8.5% and now accounts for 70% of all items ordered. It has recruited 1.2 million new customers over the year.

Mobile internet sales now account for 5% of all revenue and it expects this to be in double digits in 2013. Both Very and Littlewoods websites are in the process of being fully optimised for mobile shopping.

The retailer has expanded its Collect+ customer collection points over the 61 weeks and now has over 4,000 pick-up points. 450,000 shoppers use the pick-up points.

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