Shares in fast fashion multichannel retailer QUIZ closed down 36.72% this evening at 93.5p following a trading update in which it revealed that EBITDA for the first half of FY19 would be £1.5m down on expectations at not less than £5.5m.
A number of factors had contributed to the revision, it said, including lower store and concessions sales in September, lower than expected online sales via third party sites and a £400,000 provision for the hit taken as a a result of the collapse of House of Fraser.
The Glasgow-based group said it was taking steps to address the trend of lower than expected sales with third parties. However it added that it was taking the “prudent assumption” that should the trend continue into the second half then its full-year revenue would be down against current market expectations at approximately £138m (FY 2018: £116.4m) and the group’s EBITDA for FY19 would to be in the region of £11.5m.
In H1 the business achieved top-line growth across all channels with UK store and concessions up 9% at £35.1m, online sales up 44% at £20m and international sales up 16% at £11.6m. Overall group revenue increased by 19% to £66.7m.
Chief executive Tarak Ramzan said: “QUIZ has delivered further good growth during the period despite challenging external trading conditions. I am pleased to say that our new QUIZ X TOWIE ranges have been well received and the most recent trading week has seen an improving trend following a very challenging September in the UK.
“Although online sales through our third-party partners have been disappointing and will impact the Group’s performance for the full year, the changing mix towards increased own-website sales will support profitability growth moving forward.
“The continued growth of the QUIZ brand in combination with our well-invested infrastructure and flexible business model continue to underpin the Board’s confidence in the Group’s long-term prospects.”