Online fashion retailer boohoo (LON: BOO) is set to report a further set of good figures on Wednesday and that contrasts with the results of fellow fashion retailer Quiz (LON: QUIZ).
Quiz did slightly better in the first quarter than it did in the fourth quarter of the previous year, but the improvement was minimal. The figures themselves had already been well-flagged, but the passing of the dividend may have surprised some.
Quiz, unlike boohoo, is a hybrid retailer with a high street presence as well as an online presence. The declines are in the high street area, while online is still growing but at lower gross margin. Acquiring customers has become extremely costly.
The concessions in department stores are not doing well and at least 20 of these are being closed, leaving 143 concession stores. Other loss-making sites will be closed, although there will be new stores.
When it floated, Quiz started to build up overheads in expectation of sales growth that did not happen. Up to £3m in annual savings could be generated.
Even so, Quiz needs to show that its review of strategy can come up with a way of rejuvenating the brand. A loss is forecast for this year, on flat sales, and next year on modest growth in revenues.
It is very different at boohoo. All its brands have been growing strongly.
The first quarter of the previous year was comparatively weak and that should be taken into account. Even so, growth in revenues of more than two-fifths to around £264m is still impressive.
PrettyLittleThing is expected to be 60% ahead, while the more mature boohoo should still grow revenues by 25%.
There should also be news of the online womenswear MissPap acquisition in March 2019. MissPap was going to appoint a liquidator so it was an opportunistic purchase. It was always viewed as a competitor to the boohoo brands.
There should be news about integration and how it will fit within the portfolio of brands owned by boohoo.
The new Pretty Little Thing warehouse in Sheffield should be starting to generate efficiencies thanks to automation.