Rapha, a renowned cycling brand that recently made headlines for being acquired by Walmart heirs Steuart and Tom Walton, is now facing financial challenges. According to the latest accounts covering the six months to January 2018, the company reported a significant £20 million loss, a stark contrast to the previous year’s £1.4 million profit.
Despite experiencing a nearly 40% increase in revenue to £67.1 million in the previous 12 months, Rapha saw a dip in sales during the latest six-month period, only reaching £42.2 million. This decline has prompted the company to implement changes, including cost-cutting, job cuts, and price reduction campaigns, all under the leadership of founder Simon Mottram.
Following the acquisition by RZC Investments, Rapha’s future remains uncertain as it navigates through these challenging times. While the brand continues to attract interest from potential bidders like Investindustrial and Invus, it remains to be seen how Rapha will weather the storm.
In a fiercely competitive market, Rapha’s journey from profitability to losses and subsequent operational changes underscores the realities faced by established brands. Only time will reveal whether Rapha can overcome its current struggles and emerge stronger in the ever-evolving world of cycling apparel.
For more information on Rapha and its recent challenges, refer to the following links:
1. The Guardian – Rapha faces challenges with £20 million loss
2. BBC News – Rapha’s financial struggles after acquisition
