City Chic’s sales slip; promotions dent margins
Global plus-size fashion retailer City Chic is gearing up for a loss in its December half earnings as “volatile” demand has led to poor sales.
In a trading update based on unaudited accounts for the period to January 1, the business recorded a sales decline of 8 per cent to $168.6 million. Online sales fell 21 per cent.
An underlying EBITDA loss of between $2.5 million to $4 million is also likely due to reduced revenue and higher fulfilment costs.
Increased promotional activities during key Black Friday, Cyber Monday and the Christmas / Boxing Day sales periods impacted the group’s gross margin.
By region, Australia and New Zealand sales fell 3 per cent to $79.46 million while its business in the Americas is down 14 per cent to $68.93 million.
European sales fell 4 per cent to $20.16 million due to “challenging market conditions”.
Phil Ryan, CEO and MD of City Chic said the company was maintaining strong engagement with its core customer groups and is on track to deliver on strategic logistics initiatives.
“We remain extremely confident in executing our strategies and returning to profitable growth as these cyclical headwinds unwind.”
Audited results will be announced on February 27.
Comments are closed.