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Fashion Network
5 days ago
- Business
- Fashion Network
FatFace shuts US stores, goes online-only there, annual sales and profits fall but current year improves
FatFace is to shutter all 23 US stores as the Next -owned fashion and lifestyle retailer adopts a digital-only sales approach in North America while moving its growth focus to the UK and new markets. Rising costs and economic uncertainty had made the current omnichannel model unviable, according to reports. The US closures will see the loss of 145 jobs. FatFace will instead continue to invest in its UK stores while expanding into new international markets with an online offer in the coming months. The retailer has been busy growing its physical presence in the UK having opening three new stores and refurbishing others this year. It trades from 170 stores in the UK and employs around 2,400 staff. The news came amid reports that FatFace (whose results are usually filed in October) saw a dip in full-year sales and profits in the year to 25 January as the brand migrated its online ops onto Next's Total Platform. It posted a 21% decline in pre-tax profit to £16.9 million. Sales fell 11% to £237.4 million, due to the focus on full-price sales and its 'smarter' product proposition across womenswear, menswear and accessories. However, following that, pre-tax profit has risen during the first half of its current financial year, boosted by a 6.6% uptick in full-price sales and 3.4% increase in like-for-like store revenue. Trading through Next has surged 86% year-on-year, following the retail giant's acquisition of FatFace at the end of 2023. FatFace CEO Will Crumbie talked of 'good progress in executing our strategy and financial objectives. We continued to focus on full-price sales, with a strategic approach to discounting at specific times of the year. Our store network continues to be a core part of our offer with new stores opened in the year.'
Yahoo
27-03-2025
- Business
- Yahoo
H&M Profit Disappoints on Steep Discounts and Strong Krona
(Bloomberg) -- Hennes & Mauritz AB posted weaker-than-expected profit in its first quarter, hit by the strengthening of the Swedish krona and an increased discounting of its clothes. Shares tumbled. They Built a Secret Apartment in a Mall. Now the Mall Is Dying. Why Did the Government Declare War on My Adorable Tiny Truck? How SUVs Are Making Traffic Worse Trump Slashed International Aid. Geneva Is Feeling the Impact. These US Bridges Face High Risk of Catastrophic Ship Strikes The fast retailer's operating profit of 1.2 billion Swedish kronor ($120 million) in the three months to Feb. 28 was much lower than the 1.9 billion kronor analysts had expected. The trend is continuing in the current quarter, with the company weighed down by excess stock levels and higher purchasing costs. Net sales reached 55.3 billion, below the 55.8 billion kronor analysts had expected. Although H&M is making 'important progress' in its turnaround, sales and earnings in the quarter were 'somewhat weaker than planned,' the company said Thursday. Chief Executive Officer Daniel Erver, a company-veteran who took the top job in January last year, has struggled to revive top-line growth and rebuild faith in the Swedish retailer's midterm growth target for earnings before interest and taxes of 10%. The latest quarter shows that his efforts to claw out of the company's troubles through higher marketing spending has not brought the sustainable sales boost analysts had hoped for. H&M shares fell as much as 5.1% in early trading in Stockholm, the biggest intraday drop since March 12. The weaker results at H&M came as Next Plc raised its profit guidance for the current fiscal year on Thursday, after topping £1 billion of profit last year. The UK clothing and homewares retailer said the company is growing on many fronts, with sales at home and overseas rising and its Total Platform, where it sells third-party brands online, also showing good growth. Next shares rose as much as 9% in early trading in London. Earlier this month, rival Inditex — the owner of sector-darling Zara — reported a disappointing start to the year, feeling the impact of cuts in consumer spending amid a slowdown in large parts of the global economy. The world's largest listed clothing retailer saw its share plunge on the report. H&M, controlled by Sweden's Persson family, said its preliminary sales figure for March shows an increase of 1% in local currencies compared to the same month the previous year. The company said the negative effect of external factors, increased markdowns and investments in customer offerings is estimated to be significantly smaller in the second quarter than in the first. Business Schools Are Back Google Is Searching for an Answer to ChatGPT A New 'China Shock' Is Destroying Jobs Around the World The Richest Americans Kept the Economy Booming. What Happens When They Stop Spending? How TD Became America's Most Convenient Bank for Money Launderers ©2025 Bloomberg L.P. Sign in to access your portfolio
