The Telegraph
Fashion retailer New Look’s losses have continued into its third quarter as it struggles with a turnaround.
New Look’s turnover fell 6.3pc to £1.07bn in the 39 weeks to December 23, as sales shrank 10.6pc across the group and fell 10.7pc in the UK, on a like-for-like basis. The company made a pre-tax loss of £123.5m.
Sales on New Look’s website also plummeted 15pc, but it had some cheer from selling its products on third-party e-commerce sites, where sales rose 21.9pc.
Alistair McGeorge, the executive chairman that New Look brought back into the business to help with its turnaround effort, said: “Third quarter trading remained challenging, with sales and margins impacted by the high level of discounts.
“Our immediate priority is to exit the current financial year without excess stock.”
He said that by entering its next financial year “with clean stock levels”, the company would be in “a good position to deliver a strong full price spring/summer offer”.
Mr McGeorge said that the company currently had enough liquidity to implement its turnaround plans, which include cost-cutting and “reconnecting” with customers, many of whom it lost when it attempted to shift its appeal to "millennial" shoppers. The retailer said it was now attempting to recover the “broad appeal” of its products.
“We are already realigning our pricing to offer significantly better value, adding flexibility to our buying model, and improving our speed to market,” he said.
New Look has come under pressure from its bondholders to agree to a costly financial restructuring, as the lenders seek to avoid further damaging losses. The company is working with advisers at Deloitte on plans to cut its rental bill by shutting around 60 stores, or 10pc of its UK shop estate. A committee of bondholders is being advised by Rothschild.
Tags
Business