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Refreshed Robert Dyas surges back into the black

Homewares and hardware retailer Robert Dyas surged back into the black last year as it benefited from rebranding and a drive to attract younger customers.

The retailer focused on better buying, more own-brand products and tight cost control to generate a pre-tax profit of £2.7m versus a £10.4m loss the previous year, after a series of one-off costs.

Turnover edged up from £107.8m to £108.2m in the year to March 27. Like-for-likes dipped 0.5% but in the latest nine-month period showed an improvement of 1% - the retailer’s best performance in five years.

Like-for-likes have continued to rise in the current year to date, chief executive Steven Round said. Robert Dyas also achieved its first EBITDA growth in five years - up 5% to £4.6m - during some of the toughest trading conditions retailers have experienced.

At the beginning of 2009 the 98-store retailer was teetering on the brink before Round, along with then-chairman Ian Gray, led a management buyout in April. In September Robert Dyas agreed a debt-for-equity swap with lenders Lloyds TSB and Allied Irish.

Round told Retail Week: “Last year was extremely difficult as we went through the restructuring. But now the business has stabilised and has the potential to grow, and management can please customers instead of concentrating on the precariousness of the financial situation.”

Round said Robert Dyas had benefited from “redesigning its proposition”, including rebranding and an overhaul of its store model. The initiatives, along with changes to the product range, have broadened the retailer’s customer base. “We’re appealing to a slightly younger customer than we have done traditionally,” said Round.

He added: “The market is very difficult, competitive and volatile. It’s not easy, but we’re in a good position and we envisage profits to grow this year too.” Despite his caution about prospects, Round said growth would be fuelled by more changes to come in space and category management.

Robert Dyas, which operates largely in the southeast, expects to open four stores this year and refurbish seven.

Source : Nicola Harrison - Retail Week

23 July 2010
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