Paul Smith Group Holdings Limited, the parent company of the Paul Smith brand, has announced a strong recovery for the year ending in June. Despite facing industry-wide challenges, the company saw a 7.7% increase in turnover, reaching £212.5 million, bringing it back to pre-pandemic levels.
This growth was experienced across all major channels, although it did come with increased costs due to investments in promotions and business growth. Gross profit rose to £112.5 million, and operating profit also increased slightly to £4.1 million. However, the company still reported a pre-tax loss of £2.3 million, although this was an improvement from the previous year.
The company maintained a strong cash position and saw its net assets rise to £74.1 million. This increase was partly due to a share issue of £10 million. Retail sales showed positive growth with a 12.8% increase overall and a 12.5% increase on a like-for-like basis. The AW22 season saw an 8.2% increase in sales overall, and the SS23 sales rose by 8.9% overall.
There have been recent improvements in footfall and traffic, with retail sales for AW23 up 11.6% year-on-year and 16.6% compared to the same season in 2019. E-commerce sales have also increased by 16.8% year-on-year.
Although physical stores are now fully open, e-commerce sales accounted for 31% of the retail sales total, down from 34% the previous year. The company plans to continue investing in its digital capabilities and marketing activities.
The company continues to review and refine its portfolio of physical spaces. It closed shops in Melbourne and Sydney, relocated its Amsterdam store, and temporarily closed its Heathrow Terminal 2 store for a revamp.
Wholesale sales improved during the period, with a 4.2% increase to £86.1 million. The company remains cautious for the coming year as its wholesale partners are still managing their stock levels and liquidity.
Licensing income for the business saw a narrow 0.9% increase to £15.8 million, primarily due to the successful launch of its new eyewear partner. The company operates territorial and product licenses, mainly covering Japan.
Overall, Paul Smith Group Holdings Limited is satisfied with its recovery and growth despite the financial losses. The company remains committed to investing in its digital capabilities while focusing on areas of positive growth, such as its tailoring categories. It is cautiously optimistic about the future and plans to refine its strategies to navigate the changing landscape of the fashion industry.
Links:
1. Paul Smith Official Website
2. Paul Smith Japan Website
