N Brown H1 revenue flat at £347m, but profit rises

Manchester-based online fashion and home goods retailer N Brown Group said on Friday its revenue was flat at £346.8 million in the six months to August 28 — but said adjusted profit before tax rose 7.1% to £24.2 million amid the group’s “focus on profitable growth, rather than promotion-led sales.”

N Brown’s five core brands are Simply Be, Jacamo, JD Williams, Ambrose Wilson and Home Essentials.

Statutory profit before tax soared 100% to £28.2 million “which reflects a £4.5m improvement in exceptional costs and £8.0m fair value movement on the group’s financial instruments.”

N Brown shares rose about 5%.

In its guidance for the full year, N Brown said: “As a result of our improved product and branding, we have taken the decision to focus on profitable growth, rather than promotion-led sales.

“As a result, product revenue is now expected to grow +1% to +4%.

“We expect the financial services rate of revenue decline to improve in the second half of the financial year and to be c.(5)% for FY22.

“Overall, we now expect group revenue to be broadly flat. 

“As a result of our focus on profitable growth, we re-iterate our previously communicated expectation for adjusted EBITDA to be in the range of £93m to £100m.

“We now expect capex to be c.£25m in FY22, lower than previously guided but a step up on last year due to strategic investment, net of certain project spend now being expensed.

“Net interest costs are now expected to be slightly lower at c.£15m.

“Depreciation and amortisation is expected to be c.£40m.

“At the end of FY22 we expect the group to have a strong unsecured net cash position and at that point the board will consider the resumption of dividend payments.

“FY22 year-end net debt is now anticipated to be slightly lower than previously guided, in the range of £270m to £280m.”

N Brown Group CEO Steve Johnson said: “Over the last six months the consumer environment has been volatile.

“Nevertheless, momentum has continued throughout the business, with customers responding well to our improved product ranges; particularly across our five strategic brands.

“This is testament to the restructuring work we have done across the group and the investments we are beginning to make to support our refreshed strategy …

“Our mission is to be the most inclusive retailer in the UK, across both fashion and home.

“We’re excited to see new brand partnerships resonating with both existing and new customers, bringing this mission to life, including Amanda Holden and Davina McCall on JD Williams, and Frankie Bridge and Nicki Bamford-Bowes on Home Essentials.

“We continue to deliver on our plan and are feeling well prepared for peak trading.

“EBITDA remains in-line with our expectations, and we are looking forward to exciting our customers with our new ranges as we head towards the Christmas peak.

“However, we do so with the backdrop of continued uncertainty around consumer confidence.”

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Mark McSherry
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