Simply Be owner warns cost rises to last into 2024

LAURA MCGUIRE

THE OWNER of Simply Be and Jacamo has told investors that it expects the hangover of high inflation and low consumer confidence to continue to impact the business next year, with the retailer posting a more than 80 per cent reduction in profitability.

N Brown, which trades solely online posted a 5.3 per cent decline in revenues for the year down to £677.5m compared to £715.7m in the same period last year, as a tough trading environment impacted its cost base.

The group said it wants to improve its bottom line, moving further into clothing, and has launched a new online mobile app for Simply Be. However, it warned that it expects further increases in adjusted operating costs to group revenue ratio in FY24, due to inflationary pressures –particularly in administration and payroll costs.

Steve Johnson, chief executive

said: “We continued to make strategic progress despite these challenges, increasing investment during the year, and we successfully launched our new mobile-first website for Simply Be.

“We are expecting the weaker consumer confidence to continue weighing on our performance before we see a return to growth and are therefore keeping a tight control of costs,” he added.

The fast fashion industry at large has been in the spotlight since the end of the pandemic, with a more significant return to in-person retail than many analysts expected during the workfrom-home driven boom.

Earlier this week Asos, which has been forced into a significant transformation programme to reduce costs, received a long-overdue boost after reports it had been in discussions with an overseas buyer about a potential takeover last will create up to 800 new jobs, according to reports in The Sun.

Other online-focused retailers including THG have similarly had a tough time on the stock market since the end of lockdown restrictions.

“As we highlighted previously, inflation remains at elevated levels in central Europe, against which trading in Pepco stores has remained challenging during the third quarter to date,” Trevor Masters, chief executive of Pepco Group, said.

“Despite this, we have continued to do the right thing for customers on a budget by maintaining our price leadership and growing our market share.”