Sales up but warm weather and pound's plunge hits profits at Fat Face
Fashion retailer Fat Face has boosted sales despite nursing a blow to profits triggered by a warm autumn and the collapse in the value of the pound.
Total sales notched up 7.4% to £220.7 million in the year to May 28, as it opened 12 new UK stores and saw online sales jump by more than a fifth.
But the plunge in the value of the pound following the Brexit vote, coupled with an unseasonably warm autumn, caused earnings before interest, taxes, depreciation and amortisation (EBITDA) to slide 8% to £33.5 million over the period.
Chief executive Anthony Thompson said it was a year of "investment and transition ", which had included a push into the American market with the opening of an online store and three shops on the East Coast.
He said: "Investment in the business combined with the dollar strengthening against the pound and the clothing sector trading through an unexpectedly warm and wet autumn 2015, adversely impacted our EBITDA.
"Nevertheless, we maintained our full price stance through the Christmas trading period and delivered sales growth in all channels across the 12-month period."
The company drove £10.1 million into capital expenditure projects for the year ending in May, including the construction of a 120,000 sq ft distribution centre at Dunsbury Hill Farm, Havant, Hampshire, set to open in the fourth quarter of this year.
It also trimmed its debt pile by 11% to £150 million.
Mr Thompson said the retailer, which has 228 stores in the UK, Ireland and United States, was moving towards a "new period of expansion".
Fat Face was launched in 1988 when founders Tim Slade and Jules Leaver began a business selling T-shirts in the Alps.
The firm, which was snapped up by private equity firm Bridgepoint in 2007, abandoned plans for an initial public offering (IPO) two years ago.