Profits surge 47% for discount retailer The Works
SUTTON Coldfield-based discount retailer The Works has announced strong trading results as a rebalancing of its product offering continues to win favour with consumers.
For the financial year ending April 2014 the company saw a 7% surge in like-for-like sales and EBITDA increase of 47% to £8.2m.
The Works, which has over 300 stores across the UK, delivered total sales of £141m for the year, up 5.5% from £134m in 2013, with growth driven by accelerating e-commerce sales and a strong performance in key product categories.
Other performance highlights for the year included a 90% increase in like-for-like e-commerce sales, a 5% increase in like-for-like store sales, a 12% increase in H2 sales and a gross profit margin increase of 0.5%.
Kevin Keaney, CEO, The Works said: “We are thrilled to be announcing such a strong set of results. Over the last three years, we have been gradually shifting The Works’ product offering in order to become the family-friendly discount retailer we are today. The rebalancing of our range towards gifts, art & craft and stationery has been key to our strong sales and profit growth over the last 12 months.”
In the last financial year, The Works spearheaded three major initiatives, each aimed at enhancing shopper experience in-store and online. The company launched its Together Reward Card loyalty programme – the first of its kind in the discount sector. It also continued to enhance and expand its e-commerce platform and launched a trial of new store formats in eight of its stores.
These new format stores included a re-branding of store fascia to ‘theworks.co.uk’ and a redesign of store layouts to create distinct shopping zones, including dedicated ‘Kids’, ‘Art & Craft’, ‘Family Gifting’ and ‘Stationery’ areas, making stores easier to navigate and shop.
“We have been really pleased with the performance of our new format trial stores and we plan to rebrand and refresh the majority of our store estate over the next three years. We are also delighted with the positive impact our Together Reward Card loyalty programme has had on the frequency of visits from our most loyal shoppers,” added Keaney.
Anthony Solomon, The Works’ chairman, said: “This is our seventh consecutive year of sustained growth and expansion, which is outstanding considering the tough economic and retail climate. Over the last 12 months, we’ve worked tirelessly to expand our product mix to ensure it continues to be appealing and exciting for our customers. We have seen fantastic sales growth in categories such as art & craft and stationery, and continue to offer our customers good quality and great value for money.”
He said he was confident the business was well positioned to capitalise on new growth opportunities both on the high street and online.
Retail entrepreneur Solomon owns the business in conjunction with private equity firm, Endless.
