The Very Group experiences a rise in pre-tax losses amidst a 5% drop in sales during the first quarter of the financial year.
- Losses before tax have escalated from £5.8 million to £22.9 million.
- Total group sales reduced to £450.2 million, with Very UK and Littlewoods brands facing declines.
- Retail sales dropped by 4.6%, particularly impacted by an 8.6% fall in fashion and sport.
- CEO Robbie Feather remains optimistic about future profitability improvements despite current challenges.
In the first quarter ending 28 September, the Very Group reported a significant increase in its pre-tax losses, which expanded to £22.9 million from the previous year’s £5.8 million. The period saw overall sales contract by 5% to £450.2 million. Within this, revenue for the company’s flagship brand, Very UK, declined by 3.8% to £392.1 million, whereas Littlewoods experienced a sharper decrease of 14.4%, settling at £45 million.
The retail segment reflected a 4.6% downturn in sales, heavily impacted by an 8.6% drop in the fashion and sport categories. This decline has been attributed to what the company describes as a “heavily discounted and contracting market.” Meanwhile, the beauty and home departments displayed resilience, growing by 4.2% and 2.5%, respectively. The electrical segment, however, saw a reduction of 4.4%.
Despite these challenges, the Very Group’s CEO, Robbie Feather, expressed an optimistic outlook for future profitability. He highlighted the relevance of the company’s business model, which integrates multicategory digital retail with flexible payment solutions, as a key asset in navigating the current market conditions. Feather noted, “In a challenging environment, our results reflect a resilient retail performance that remained ahead of the UK online non-food market, as well as a continued strong Very Finance performance.” According to him, the company’s focus on robust cost management has played a significant role in maintaining earnings growth.
Feather’s statements underscore confidence in the company’s strategic direction, suggesting that although current conditions are challenging, there is a belief in a positive trajectory for FY25. The emphasis on strengthening profitability reflects a commitment to adapting business strategies to mitigate losses and drive future success. This outlook is supported by the inherent strengths of Very Group, including its growing customer base.
The Very Group’s strategy amidst current market adversities highlights its focus on leveraging a resilient business model to enhance profitability in upcoming periods.
