Profits soar but rising costs leave Sir Philip Green cautious about 2011
Womenswear retailers Wallis and Dorothy Perkins also performed well, but menswear chain Burton and plus-size retailer Evans had tougher years. Department store chain Bhs grew like-for-likes by 0.9%, meaning the group produced an overall like-for-like increase of 1.3%. Arcadia’s total sales reached just under £2.8bn.
Green said: “Topshop and Topman are still growing, Wallis was good, Dorothy Perkins fine, men’s a bit tougher and Evans pretty tough.”
He said Bhs had been buoyed by the introduction of 215 concessions from other Arcadia fascias, mostly Wallis and Dorothy Perkins: “It’s like own-bought [in terms of margin]. Both businesses benefit.” He also confirmed plans to close some of the Arcadia fascias’ smaller city centre stores when the leases expire over the next three years.
Green said fresh product and newness had been key to the success of those fascias which had done well. “Ultimately product does not lie - it’s about having a point of difference. We’re a hands-on business and it’s about having an opinion - when you get momentum [with successful product] you’ve got to drive it.”
Green also said he would consider bringing more concessions from non-Arcadia retail brands into Bhs. Earlier this year, Bhs trialled concessions from footwear retailer Stylo. “It’s a mix. We’re trialling new things, looking at other brands - I wouldn’t rule out putting other brands in,” he said.
However, Green said he was cautious about the year ahead. “I have to remain cautious, with increases in VAT, rates, raw materials and some wage inflation. There’s major cost growth in the supply chain, every retailer will tell you. You can’t get complacent. “
Green also highlighted how business rate rises will impact retailers when they arrive in August, saying that Arcadia’s rates bill, including new space, had increased by £50m in the past five years.
He said Arcadia would continue to grow internationally, not just through its traditional route of franchising but by wholesaling too. He said further stores are planned in the US following the signing of the second US Topshop in Chicago.
Topshop Biker jackets and shorts printed with American flags ooze rock chick. Navajo-inspired prints and fringing also feature.
Topman Bleached carrot-leg jogging pants and long-line slubby button-up T-shirts are key, as are rolled-up, extra-short summer shorts and light intarsia knits.
Miss Selfridge Sheer palazzo pants in floral prints (pictured) and sleek maxi dresses sit alongside loose-fit blouses with cutaway shoulder detail. The palette is neutral.
Dorothy Perkins Sorbet brights dominate as well as autumnal burnt oranges and browns. Riviera stripes in various sizes are used on full skirts.
By Laura Weir