Moss Bros Group plc (LON:MOSB) have given shareholders a mixed update on Thursday morning.
The firm said that it expects its adjusted loss to widen within the financial year following a decline in high street retail.
The suit and tailored clothing retailer said it has made “good” progress in the 24 weeks period from July 28 to January 11, despite a challenging retail marketplace.
The retailer rather worryingly reported that it is expecting to report an adjusted pretax loss of £1 million for the second half, which ends this month.
Across financial 2019, the firm reported an adjusted pretax loss of £400,000 and in the 26 weeks period the company has just about broken even with regards to its adjusted pretax profit level.
Total sales for the recent 24-week period were 3.0% below last year and down 3.2% on a like-for-like basis, they noted that two stores were relocated and two closed giving a total portfolio of 128 stores.
Moss remain optimistic in future outlook
Brian Brick, Chief Executive Officer, said:
“As I noted at the time of our Interim Results in September, we are gaining traction across a number of strategic levers which are aligned with our longer-term strategic goals.”
“We have seen more intensive discounting from our competitors and a materially lower level of footfall across the high streets and shopping centres of the UK. Despite this, we have resisted discounting pressures, facilitated by our careful buying plans which have meant that we are holding lower levels of terminal stock to clear. This has been particularly evident in our High Street stores where we were able to focus on delivering our core purpose of styling individuals for on form moments.”
“We continue to deliver against our brand elevating customer value proposition of offering our customers the chance to “Make It Yours”, whether they wish to hire, buy or customise their outfit using our Tailor Me service, which goes from strength to strength.”
“Despite the delivery of progress against our strategic levers, we anticipate the year ahead will continue to be challenging until we see an improvement in consumer confidence and a stabilisation in footfall across UK shopping destinations combined with a re-alignment of occupancy costs to properly balance the costs and rewards of doing business in physical retail stores.”
“We remain debt free, with a strong balance sheet, and are confident in our ability to deliver enhanced returns to our shareholders over the longer term”.”
The Group will announce its Preliminary Results on 25 March 2020.
Moss slip from September Success
In September, Moss reported that they had seen revenues climb in their half year results.
Moss Bros said that, for the 26 weeks ended 27 July, total group revenue excluding VAT amounted to £65.4 million – 1.4% up on the previous year.
Meanwhile, online sales across all platforms grew by 20% when compared to the same period a year prior. Moss Bros added that online sales from all channels now represents 15% of its total sales.
However, the company added that loss before tax widened to £2.7 million, deeper than the £1.7 million figure recorded for the first half of 2018.
Additionally, the firm announced that it had appointed Ted Baker’s (LON:TED) current interim Chief Financial Officer as its new CFO.
Moss Bros said that the current interim CFO at Ted Baker (LON:TED), Bill Adams, will take over the role from Tony Bennett.
Tony Bennett has decided to step down from the company’s board for “personal reasons” and is due to leave the business early next year in February 2020.
Shares in Moss trade at 23p (+2.68%). 16/1/20 11:27BST.
