N Brown, the owner of Simply Be and Jacamo, has seen its pre-tax profits almost halve in the full-year ended 27 February 2021, tumbling 49.4% to £30.1m as the group was hit by the pandemic.
In the same period, revenue fell by 13% to £728.8m, and total product revenue was down by 14.4% against the prior year. While product revenue was down by 25.7% in Q1, it steadily recovered to a decline of 4.3% in Q4, however.
Despite dented revenue, the group said it has made “significant” progress in its transformation plans, having successfully secured a £100m equity raising to accelerate its strategic transformation and eliminate unsecured debt alongside.
The group also reshaped its cost base with adjusted operating costs to revenue ratio, reducing from 39.8% in FY20 to 32.5% in FY21, while it cut its marketing costs by 55.7% against last year.
In its full-year results, the group discussed the launch of its new Home Essentials range, adding that the timing of the launch coincided with an increase in consumer demand for Home and Garden, triggered by the pandemic, which had an “immediate positive impact on the group’s Home sales which has subsequently been sustained”.
Looking ahead, the group currently expects group revenue growth to be between 1% and 4% for FY22, and for adjusted EBITDA to be in the range of £93m to £100m.
Steve Johnson, CEO, said: “In a year where we have all had to overcome multiple challenges, we have continued our transformation of the Group through a relentless focus on our five strategic brands, improving our product offering and enhancing our digital capabilities, all of which will position us better with our target customers. Although we remain cautious, we are beginning to see some early signs of progress.
“Our capital raise has enabled us to strengthen our balance sheet and allows us to accelerate our investment into strategic initiatives, particularly our digital platform and brand websites.”
He added: “Whilst wider consumer dynamics remain uncertain as we emerge from lockdown, we have significantly transformed the shape of the business from where it was at the start of the pandemic.
“I would like to thank every single one of our colleagues for helping us make those changes at pace, whilst delivering a very high standard of service to our customers through very difficult times.”