Hobbs’ pre-tax profits soared 137% in the year to January 29 as it recorded like-for-like sales growth of 10% and announced 300 new jobs.
Pre-tax profits at the premium womenswear chain shot from £2.9m to £6.9m on turnover up 12.2% to £102.5m, after impressive growth in sales across stores and direct channels.
Gross margin slipped to 63.6% from 65.3% as Hobbs upped promotional activity to match “aggressive levels of discounting” by competitors, said chief executive Nicky Dulieu.
But she added that Hobbs has had to rely less on promotions this year. “This season customers have realised they can’t keep waiting for promotions. The customer is valuing the integrity of the brand a bit more and tending to get things at full price.” Sustained growth is behind the creation of the new roles across design, head office and retail over the next two years. Hobbs will forge closer relationships with UK fabric suppliers as part of its increasing focus on British manufacturers. It is showcasing authentic British fabrics as part of its autumn 11 London collection, on its 30th anniversary.
Its Hobbs Invitation occasionwear sub-brand, which will sit alongside Hobbs London, Hobbs Unlimited and NW3 by Hobbs, will formally launch next spring.
In June, Hobbs secured £46.5m of funding from backer 3i, together with Barclays and The Co-operative Bank, to double its 64-store estate and expand its international business.
Dulieu added: “For many of our customers individual styling and a personal, in-store service remains their preference.” The group hoped to increase UK share “through our multi-channel and multi-brand strategy”.