New Look profits up as firm continues to regroup
New Look has reported an increase in profits as it pushes ahead with radical plans to cut costs and appeal to a broader range of shoppers.
For the 13 weeks ended June 23, New Look’s total revenue fell by 2.7% to £329.4 million, down from £338.7m during the same quarter last year.
New Look brand’s like-for-like sales were down 4%. However, this was an improvement on the 8.2% decline recorded last year.
Adjusted earnings before interest, tax, depreciation and amortisation stabilised, rising 1.5% to £27.6m.
Underlying operating profit increased from £12.1m to £14.4m, up 19%.
The retailer said the rise in earnings was supported by cost savings.
New Look has been pushing through a radical store closure programme though a Company Voluntary Arrangement (CVA), leading to hundreds of job losses.
The business is shutting 70 stores as part of the CVA plans, affecting close to 1,000 jobs.
The retailer has achieved £70m of cost savings in the first quarter, and is looking for more savings in the months ahead.
To help restore the retailer to health, Alistair McGeorge, who was formerly executive chairman between 2011 and 2013, has returned to the business.
Mr McGeorge has been bringing down prices to make sure New Look can appeal to a broader range of consumers.
“As we recover the broad appeal of our product, we were pleased to improve our market performance and deliver better customer conversion rates,” he said.