Radley, a British handbag and accessories brand, reported a 2.1% growth in group revenue to £77.3 million.
- The growth was primarily driven by a substantial increase in wholesale and US market sales.
- The company’s profitability fell due to website re-platforming issues and the costs of opening new stores.
- Radley experienced an 8% increase in direct-to-consumer sales, despite challenges in online sales.
- Sales in the US market grew by 12%, with Amazon marketplace sales significantly contributing to this growth.
Radley, a renowned British handbag and accessories brand, has demonstrated resilience and growth in its latest financial year, marked by a 2.1% increase in group revenue to £77.3 million. This expansion is chiefly attributed to significant gains in its wholesale operations and the US market, underscoring Radley’s strategic focus on these areas.
The profitability of the company faced challenges, with underlying EBITDA dropping to £4.4 million from £5.2 million. This decline was notably influenced by disruptions related to website re-platforming and financial investments in new store openings, particularly in Essex’s Braintree Village and Seaham’s Dalton Park.
Radley’s direct-to-consumer (DTC) strategy proved effective, achieving an 8% year-on-year increase in sales across its UK stores and outlets. This growth reflects a post-pandemic resurgence in physical retail, indicating a robust recovery in foot traffic and consumer spending within brick-and-mortar stores.
Despite this, Radley’s online DTC sales experienced a 20% year-on-year decrease due to temporary disruptions from website re-platforming efforts, which have since been resolved. The brand’s ability to swiftly address these challenges highlights its commitment to maintaining seamless online operations.
In the UK, Radley’s wholesale arm saw a 12% increase in year-on-year sales, with a strong performance in John Lewis Partnership concessions contributing significantly. Yet, total UK sales saw a slight decline of 1%, illustrating a mixed performance across different channels.
In contrast, the US market presented a more positive outlook, with total sales growing by 12% year-on-year. A transition towards a drop-ship fulfilment model with partners led to a drop in wholesale sales by 26%, but this was offset by an increase in sales through the Amazon marketplace, which rose by 38%.
Additionally, Radley saw a 4% increase in income from licensed products, including watches, jewellery, eyewear, and beauty items. This diversification within product categories has allowed Radley to expand its brand presence and revenue streams.
Nick Vance, the recently appointed CEO, noted the ongoing consumer demand in the US as a pivotal driver for growth, emphasising the effectiveness of a multi-channel approach in both the UK and US markets.
Radley’s strategic focus on the US market and wholesale channels has yielded commendable revenue growth, albeit with challenges in profitability.
