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Robert Dyas Reports 6.3% Rise in 2019 Revenue

Robert Dyas Henley

The Theo Paphitis Retail Group has reported on trading for the 12 months to 30 March 2019 and 6 weeks to 24 December 2019, advising of a 'resilient Group performance amid challenging conditions'.

FY19 summary

·       Ryman: Good performance with total revenue increasing by 1.4% to £129.9m, delivering an increase in EBITDA of 6.5% to £8.2m (FY18: £7.7m) reflecting focus on introduction of new categories, development of related services and customer engagement in store

·       Robert Dyas: Strong performance with total revenue increasing by 6.3% to £131.8m; EBITDA increased to £1.6m (FY18: £0.5m) reflecting strong online growth following introduction of new categories and a good performance in outdoor categories during summer peak

·       Boux Avenue: The business experienced challenging trading conditions throughout the year, which have continued post the period end, resulting in an ongoing strategic and operational review of the business.

Christmas 2019 trading update

·       Group Like-for-like (LFL) sales decline of 1.3% comprised of positive sales at Robert Dyas, flat sales at Ryman and a reduction in sales at Boux Avenue

·       Online sales mix of total business increased to 21.8% for the Group, with Boux Avenue now approaching 50% of total sales and strong e-commerce growth at Ryman, London Graphic Centre and Robert Dyas

Theo Paphitis said: “Looking back at the prior financial year and this Christmas, our Group has delivered a resilient performance in what has been the most challenging retail environment we have ever experienced, underpinned by consumer uncertainty and declines in footfall.

“I am pleased that Ryman and Robert Dyas, as heritage brands on our high streets, have traded well over the prior financial year. Both businesses put in good performances, growing sales and profits as they focused on strong retail execution and category development, both online and in store. Christmas trading was also creditable for both businesses.

“Although a small part of our overall Group, we were delighted to see the London Graphic Centre deliver remarkable LFL growth and online sales following its increased focus on product ranging, customer service and engagement, including the introduction of art-based activities in store.

“Boux’s online sales performance during the Christmas period tells its own story, accounting for almost 50% of total retail sales.  As a greater proportion of fashion sales migrate online in the UK, it’s clear that the relevance of shopping centres to fashion retailing – and particularly Boux’s core demographic of 18-30 year old females – is dramatically different from what it was when we launched the business in 2011.  It is not a surprise, therefore, that trading has been most challenging in the majority of our 30 Boux Avenue shopping centre stores, which has contributed towards a double-digit decline in LFL sales in recent months.

The significant costs of marketing your brand to customers in these locations no longer makes sense, and one of the most significant factors we must address is the rents we are paying across our shopping centre destinations.  Boux is still paying significantly above average market rents whilst competitors and co-occupiers have been able to completely realign their rental cost base, often through CVAs. This does not tally with the overall experience we have had with our other businesses located on the high street where we have made some progress in renegotiating rents back towards the market average following constructive discussions with a number of landlords.

We have seen progress with the turnaround plan we implemented at Boux last year and the reaction to our new designs and products has been encouraging. The contribution to Boux’s ranges from product designed by our in house team, led by Zoe Price Smith is increasing and will be entirely influenced by them from the Autumn this year. However, the lower than planned growth in Boux’s overall business, partially impacted by lower footfall experienced at these locations, as well as an unsustainable cost base has meant that we are accelerating a strategic and operational review of the business, leaving no stone unturned. We will look to address our cost base, in particular our rents, as well as addressing the appropriate mix of channels to match the changing needs of our customers. Given the significant importance of the review, this will be led by me personally, supported by our Group board. The publication of Boux’s financial statements will follow pending the outcome of this review.

“As I have previously said, the lack of reform and focus on business rates by the Government and other authorities continues to frustrate us and puts at risk one of the key sectors for the UK economy. However, I am a firm believer that both physical and online retail have a future and we are seeing that we are able to deliver further growth through our heritage brands, Ryman and Robert Dyas, through our e-commerce and other new channels. I would like to thank our loyal colleagues and suppliers for their continued support and we remain confident in the strength of our Group and its collective portfolio of brands.”

Source : Theo Paphitis Retail Group

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20 January 2020

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