TIDMBWNG
RNS Number : 0730A
Brown (N.) Group PLC
18 January 2024
18 January 2024
Q3 TRADING UPDATE FOR THE 18 WEEKSED 6 JANUARY 2024
Transforming the business and building resilience. Full year
EBITDA on track
N Brown Group Plc ("N Brown" or the "Group"), a top 10 UK
clothing & footwear digital retailer, today provides an update
on trading for the 18 weeks ended 6 January 2024 ("Q3 FY24").
Highlights
-- Improving product revenue trend continued in Q3
-- FY24 Adjusted EBITDA(1) guidance remains unchanged
-- Ongoing investment in transformational priorities with
further progress expected in 2024
-- Strong balance sheet, with total accessible liquidity of over
GBP150m
Revenue
Q3 FY24 Change Q3 FY24 YTD Change FY24
FY24 v Q3 YTD v FY23
FY23(2) YTD(2)
Product revenue GBP150.2m (9.7)% GBP337.7m (10.6)%
----------- ----------- ---------- ------------
Strategic brands(3) GBP111.4m (7.9)% GBP250.8m (7.6)%
----------- ----------- ---------- ------------
Heritage brands(4) GBP38.8m (14.7)% GBP86.9m (18.1)%
----------- ----------- ---------- ------------
Financial Services
revenue GBP75.8m (8.5)% GBP185.3m (8.8)%
----------- ----------- ---------- ------------
Group revenue GBP226.0m (9.3)% GBP523.0m (9.9)%
----------- ----------- ---------- ------------
The improving product revenue trend reported in the Group's
Interim Results on 12 October 2023 continued in Q3 (Q1: -11.9%; Q2:
-10.4%; Q3: -9.7%). This reflects an improvement in both our
Clothing & Footwear and Home businesses in the quarter. Strong
performance was seen in categories including third-party branded
womenswear and lingerie, beauty, gaming consoles and our premium
own-brand, Anthology.
Average item values have continued to be higher, driven by
pricing discipline and product mix, whilst volumes, as expected,
reflect the continuation of lower consumer confidence and measured
choices which we have taken around margin, including the level of
marketing investment.
Within partnerships, the launch of Simply Be on Sainsbury's
online clothing platform and selected stores is performing strongly
in its first year, as well as providing enhanced exposure to
different customer segments.
The debtor book continues to perform as expected despite the
cost of living pressures on customers, supported by our ongoing
assessment and refinement of credit scoring. Financial Services
revenue reflects the lower FY24 opening debtor book position and
the product revenue performance during FY24 YTD.
Transforming the business through strategic and operational
progress
We are continuing to invest in our transformational priorities,
building on progress over the last 12 months. Following the
successful launch of the new Jacamo website, customers are
benefitting from faster site speeds, and the sales conversion rate
has increased by around 20% despite lower promotional activity.
We expect to make further progress to enhance the customer
experience in 2024, including the roll-out of the new JD Williams
website and the addition of new technologies such as our Product
Information Management ('PIM') system, enhancing product
descriptions for customers to inform their purchases and which we
expect will also lead to reduced returns.
The Net Promoter Score ('NPS') for Q3 of 64 is 11pts ahead of
last year and includes benefits from better delivery performance as
well as customer experience improvements.
The Group received the Drapers Award for Diversity and Inclusion
during the period, which is testament to the broader work taking
place in the business, in addition to the technology-focussed
transformation.
Building resilience through a strong balance sheet
The proactive moderation of stock intake and clearance of older
items reported in the Interim Results allowed the business to enter
peak trading with a cleaner stock position. Stock and other working
capital items have continued to be well managed, with stock at 6
January 2024 c. GBP26m lower year-on-year, and with the continued
cleaner position providing a good platform into the remainder of
FY24 and into FY25.
As at 6 January 2024, the Group had a total of GBP66.3m across
unsecured net cash (GBP48.9m) and amounts voluntarily undrawn on
the securitisation facility (GBP17.4m), an increase of GBP30.8m
during the financial year when compared to the unsecured net cash
at 4 March 2023 of GBP35.5m with nil voluntarily undrawn on
securitisation facility. The Group's Revolving Credit Facility and
overdraft remain undrawn and total accessible liquidity at 6
January 2024 was GBP150.2m, up from GBP143.9m at 4 March 2023(5)
.
Adjusted net debt at 6 January 2024 of GBP246.1m has reduced
from the 4 March 2023 position of GBP297.4m and is now under half
of the peak level of adjusted net debt reported at the FY20
year-end (GBP497.2m), despite the GBP49.5m payment made to Allianz
in January 2023.
During the period the Group extended its securitisation facility
commitment to December 2026, maintaining the facility limit of
GBP400m. This continues to provide an efficient form of funding to
the Group and is well covered by the customer receivables book,
with a limit of up to 72 per cent of the 'eligible' customer
receivables book (current and 0-28 days past due) funded.
Outlook and guidance
Our expectations for FY24 Adjusted EBITDA(1) remain unchanged
from those outlined in our Interim Results, with slightly softer
revenues expected to be offset by further margin discipline.
Adjusted net debt is anticipated to improve when compared to
previous guidance and is expected to be under GBP260m at the end of
FY24, whilst retaining a strong unsecured net cash position.
The Board remains confident in the strategic direction of the
business and in the benefits of the ongoing investment in our
digital transformation, with a focus on delivering sustainable
profitable growth. T here has been a slight uptick in customer
optimism during 2023 and although we are assuming that
macro-economic conditions felt by consumers will still be a feature
of our performance during 2024, we believe that conditions will
gradually improve.
Steve Johnson, Chief Executive, said:
"We are pleased with the progress we have made in transforming
the business, the resilience built through our strong balance
sheet, and that our full year EBITDA expectations are on track.
"Building on what's been achieved in the last 12 months, we
continue to make progress on our strategic transformation, with the
launch of the new Jacamo website another recent milestone. 2024
will be about further improving the customer experience and
positioning the business for future growth, with scheduled launches
of the new JD Williams website as well as our Product Information
Management system, which will ensure our customers have better
product descriptions to inform their purchases. Our strong
liquidity position provides a solid base for continued investment
in our strategic priorities.
"I'd like to thank all our colleagues for their commitment
during peak trading, and their continued hard work in progressing
our transformation of the business. Change on this scale takes time
and energy, but we are confident in our strategy and in building a
stronger N Brown for all stakeholders."
Conference call
A conference call will be held at 10:00am today for analysts and
investors. To register for access, please contact Hawthorn on +44
(0)7719 078 196 or email nbrown@hawthornadvisors.com
For further information:
N Brown Group
David Fletcher, Head of Investor Relations +44 (0)7876 111 242
Hawthorn
Henry Lerwill +44 (0)7894 608 607
Simon Woods +44 (0)7719 078 196
nbrown@hawthornadvisors.com
Shore Capital - Nomad and Broker
Stephane Auton / Daniel Bush / Rachel Goldstein
Fiona Conroy (Corporate Broking) +44 (0) 20 7408 4090
About N Brown Group:
N Brown is a top 10 UK clothing and footwear digital retailer,
with a home proposition, headquartered in Manchester and employs
over 1,700 people nationwide. Through our strategic retail brands
including JD Williams, Simply Be and Jacamo, we exist to make our
customers look and feel amazing, and take great pride in
passionately championing inclusion and serving the under-served.
Our customer-first shopping experience, supported by our innovative
financial services proposition, is designed to deliver choice,
affordability, and value to our customers, and allows us to be
truly inclusive and accessible.
1. Adjusted EBITDA is defined as operating profit, excluding
adjusting items, with depreciation and amortisation added back.
2. Q3 FY24 is the 18 weeks to 6 January 2024; FY24 YTD is the 44 weeks to 6 January 2024.
3. JD Williams, Simply Be and Jacamo.
4. Ambrose Wilson, Home Essentials, Fashion World, Marisota, Oxendales and Premier Man.
5. As previously disclosed, subsequent to the 4 March 2023
balance sheet date, the Group refinanced its borrowings and
extended their maturities to December 2026, with the new RCF having
a limit of GBP75m (previous RCF facility limit of GBP100m).
, the news service of the London Stock Exchange. RNS is approved by
the Financial Conduct Authority to act as a Primary Information
Provider in the United Kingdom. Terms and conditions relating to
the use and distribution of this information may apply. For further
information, please contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTZZGMMLNRGDZM
(END) Dow Jones Newswires
January 18, 2024 02:00 ET (07:00 GMT)
Brown (n) (LSE:BWNG)
Historical Stock Chart
From Dec 2024 to Jan 2025
Brown (n) (LSE:BWNG)
Historical Stock Chart
From Jan 2024 to Jan 2025