Shop Direct shines with first pre-tax profit in a decade
SHOP Direct, the Liverpool-based fashion-focused online retailer, has reported its first bottom-line profit in a decade.
The Speke-based company, owner of the Very, Littlewoods and isme brands, made a pre-tax profit of £6.6m in the year to the end of June, compared with a loss of £57.7m in 2012.
Sales were up 1% to £1.69bn, with strong growth in the newer brands, Very and Isme, jointly delivering an 18% uplift and ‘heritage brands’ Littlewoods and KandCo seeing falls of 7%.
The company, owned by Frederick and David Barclay, the investors whose portfolio also includes The Telegraph newspaper, employs around 4,000 people, the majority in the North West, with 1,800 at head office and the remainder spead across call centres in Aintree and Little Hulton and a distribution site in Shaw, Oldham.
While earnings (EBITDA) grew 22% in the year to £132.5m, the group also saw a sharp fall in one-off costs relating to restructuring fell to £8.4m from £46.2m the year before.
In line with social trends, the group’s digital sales accounted for 78% of the total, compared with 75% in 2012. In the first quarter of the current financial year online is now 81% of all sales.
Reflecting this the number of catalogues distributed more than halved during the year – to 4 million from 8.2 million in 2012
Chief executive Alex Baldock said: “These results mark an important milestone in the journey of Shop Direct into a world class digital retailer. We’re delighted to report a positive pre-tax profit for the first time in 10 years,giving us a solid platform from which to move forward.”
He said the group would continue to invest and evolve with personalisation at the core of its offer.
“We have a new level of ambition and have set out a clearly defined and disciplined strategy for the continued evolution of Shop Direct, with world class personalisation at the heart. Our new corporate brand reflects this sharp focus and our confidence in the continued digital development of the business.
“We occupy a unique position in the UK’s digital retail market by making good things easily accessible to more people, and are proud of the part we play in our customers’ lives. Our attention and energy are now fully focused on delivering a great Christmas for our customers as we enter the busiest and most important trading period of the year.”
