Moss Bros revenues edge up but losses widen

Moss Bros revenues for H1 hit £65.4m, up 1.4% on the prior year, with like-for-like retail sales up 2.9% and like-for-like store sales up 0.6%.

Online sales across all platforms grew 20% vs H1 last year. Online sales from all channels now represents 15% of total sales (H1 2018 12.7%)

However the menswear group reported a loss before tax of £2.7m, up from £1.7m and, as a result, scrapped its dividend. Adjusted profit before adoption of the IFRS 16 accounting standards (which had a £1.1m negative impact on its profits) and before tax was just above breakeven, -£0.2m lower than the same period in the prior year (HY1 2018 £0.2m).

The company said that continued investment in in-store experience and in customer acquisition have yielded positive results across its stores in a "challenging" retail environment and declining footfall.

Moss Bros said that it was in on-going talks with landlords to "align store occupancy costs with the lower footfall".

Positive highlights for the half included on-going growth of online sales via third parties, such as Next, strong growth in its Tailor Me custom tailoring offer and a positive reaction to new season product and new technical developments, such as its eco suit, stretch, washable suit.

Its hire business, however, remained challenged and it acknowledged that it needed to invest in the product offer with positive changes coming into force by Spring next year.

"Reflecting on our first half performance, it feels that we are gaining traction in a number of areas. The return to growth of our stores is extremely important to us and we will continue to focus on maintaining this trend. The growth which we have seen in stores is set against a backdrop of lower footfall in our stores than last year in most locations in which we operate. Our conversations with our landlords are active and ongoing to ensure that we can align our store occupancy costs with the lower footfall which we experience, whilst continuing to offer store-centric services such as Tailor Me, our custom made suiting proposition, which continues to go from strength to strength," said CEO Brian Brick.

Brick added: "We have been working hard across the first half to ensure that we have a clear and comprehensive strategy with clarity, unity and focus in place across the business. We are transforming the way in which we operate to better address the needs of our core mainstream aspirational customer group, by styling individuals for 'on form' moments.

"We have identified and are investing in key strategic levers to drive long-term performance including: an evolution of Moss Bros brand; improving in our buying and merchandising; focusing further on www.moss.co.uk, Marketplaces and Tailor Me; improving store profitability; and managing our Hire business. Given the challenging retail marketplace in which we operate, this will take time and investment to deliver, but with our combined efforts, I am confident that we can return the business to profitable growth across the longer term."