Scottish vogue large warns on shopper confidence regardless of gross sales rise
Scottish fashion giant warns on shopper confidence despite sales rise

Scottish vogue large warns on shopper confidence regardless of gross sales rise

SCOTTISH vogue chain Quiz has warned that the price of residing disaster is weighing heavy on shopper confidence simply as gross sales return within the wake of the pandemic.

The information got here because the Glasgow-based agency reported hovering retailer and concession gross sales, with a rise of 48.2 per cent to £24.6 million, in its first-half outcomes. The agency was boosted by the return of customers to UK excessive avenue after pandemic restrictions have been lifted.

Nonetheless, a number of the shine has been taken off the bounce-back by “inflationary pressures”. The group mentioned whereas gross sales surged by a “marginally” better-than-expected 37.2% to £49.4m over the six months to September 30, income progress has eased over the previous two months.

Quiz mentioned it was a “development in step with different vogue retail companies as inflationary pressures started to impression shopper confidence”.

It mentioned like-for-like gross sales have been constantly larger than earlier than the pandemic throughout its 62 retailers and 62 concessions.

The corporate was earlier mentioned to have been “vindicated” by one analyst after an overhaul of the enterprise two years go through which Quiz made the strategic resolution to “retain a bodily retailer property, however of diminished measurement and on very completely different phrases”.

READ MORE: Glasgow Quiz Clothes ‘vindicated’ in new outcomes

The agency shed 93 jobs with the closure of 11 shops as a part of a restructure transfer to dump loss-making retailers and scale back its hire invoice on the time.

The corporate mentioned by taking the motion then it meant 822 of the 915 workers related to the property arm might stay with the group.

The retailer moved to purchase again inventory and a number of the property from the Kast division, which operated 82 Quiz leasehold retail shops throughout the UK and Eire, on the identical day it positioned it in administration, for £1.3m.

On-line gross sales rose by nearly a 3rd, up 28.8% to £16.1m, although the group mentioned efforts to spice up shopper basket values had been partly offset by an increase in garments despatched again.

Worldwide revenues from retailer and concessions operated by the group amounted to £3.4m, twice the 2021 determine of £1.7m.

It had six worldwide shops and 15 worldwide concessions, all in Eire, as of the tip of September, towards 5 shops and 15 concessions, the 12 months earlier than.

READ MORE: Quiz to return to revenue as demand picks up for social gathering clothes

Quiz mentioned that “in step with the opposite income channels, the group continues to pursue alternatives for long-term, worthwhile worldwide progress and is assured that this may be achieved”.

The group additionally hailed an increase in profitability over the primary due to stronger demand for full-price gadgets, whereas it additionally mentioned it had been in a position to get well rising prices as inflation pressures ramped up.

Quiz stored its full-year steering unchanged, however mentioned it is going to be depending on the essential Christmas season, and famous the uncertainty over the outlook for broader confidence.

The corporate mentioned in an replace to the London Inventory Alternate that it had whole liquidity headroom of £12.7m, together with a money stability of £9.2m and £3.5m, towards £6.5m in whole six months in the past.

It mentioned: “While it stays unsure what impression the present price of residing pressures could have on customers’ disposable earnings and on their demand for Quiz merchandise over the rest of the group’s monetary 12 months, administration stay assured that the product proposition and dedication to offering glamorous seems at worth costs will proceed to enchantment.

“The board is happy with the robust progress recorded throughout all channels throughout the interval which helps the group’s omni-channel enterprise mannequin.

“It stays assured that the model will proceed to extend its enchantment and appears ahead to reaching continued worthwhile income progress.”

Supply: London Inventory Alternate

Quiz mentioned: “The group’s income progress within the interval benefited from demand recovering additional to the elimination of coronavirus associated social restrictions.

“The group’s 12 months on 12 months income progress fee moderated because the interval progressed throughout August and September, a development in step with different vogue retail companies as inflationary pressures started to impression shopper confidence.”

Matthew Webb, analyst at Panmure Gordon, mentioned: “Quiz has traded effectively in fiscal H1, with income up 37% and gross margin forward of the comparable interval. It has additionally seen a big enchancment in its monetary headroom.

“Though buying and selling situations are clearly changing into tougher, we make no modifications to our FY23 forecasts.

“Income progress slowed to fifteen% in fiscal Q2, versus the 62% achieved in Q1. This was partly as a result of comps normalising, because the impression of Covid abated throughout the summer season of 2021.”

Mr Webb mentioned that “the strongest income progress in fiscal H1 got here from the UK shops and concessions at 48.2%”.

Shares in Quiz closed at 10.38p, down 9.98%, or 1.15p.