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Monsoon and Accessorize owner, Adena Brands Limited, has reported a £7.5m loss before tax and an EBITDA loss of £2.4m for the year to 31 August 2024, due to “significant” cost inflation which was driven by the UK National Minimum Wage rise.
The loss also comes as group sales for the year fell by 11% to £204.6m compared with the prior year.
In a filing at Companies House, Adena Brands said its performance for the year was “disappointing and a step back from the prior year”, as weak consumer demand and cost inflation was paired with underperformance in several areas.
Despite these challenges, the group’s core UK Accessorize business and core Monsoon Women’s business together accounted for approximately 70% of sales, and continued to perform well in a difficult retail environment.
During the year, cash was reportedly managed well, with £14.9m of cash and zero debt as of August 2024.
The complete results for the wider group companies – including Adena Brands Limited as well as its affiliate Middle-East venture, Monsoon Accessorize LLC – were sales of £218.7m, EBITDA of £2.2m, and cash of £15.6m.
As part of the group’s turnaround efforts, Adena Brands focused on three underperforming areas during the year to August 2024: the Monsoon retail portfolio; Monsoon childrenswear business; and its key international markets such as Italy, Germany and the Kingdom of Saudi Arabia.
While Adena Brands took action to address the underperformance, its filing at Companies House revealed that they required investment and involved transitions that led to lower sales. This impacted the group’s results for the period.
However, the group maintains that these realignments are “largely complete” as it trades through the current fiscal year, and is “seeing the benefits”.
Having completed eight months of the fiscal year that began in September 2024, encompassing key trading periods like Black Friday, Christmas, and Ramadan, and with the summer peak still to come, the group has experienced a turnaround. Adena Brands has seen a return to sales growth and profitability, and significantly improved performance in areas of previous concern.
