FatFace suffered financial setbacks following its acquisition by a major retailer.
- The brand, focusing on profit rather than sales growth, recorded a pre-tax loss.
- A significant expense of £7.9m was noted, largely due to the acquisition.
- Sales figures reached £191.5m, with UK revenue at £172.5m.
- CEO Will Crumbie emphasised strong performance amidst challenging conditions.
FatFace, a notable name in fashion retail, experienced a tumble in its financial outcomes after its acquisition by a prominent retail company. Despite a declared strategy of prioritising profit over sales growth, the brand found itself facing a pre-tax loss of £3.2 million for the 35 weeks ending on January 27, having previously seen profits of £19.5 million the prior year.
A major factor attributed to this downturn was the exceptional costs amounting to £7.9 million. These costs were primarily associated with the company’s acquisition by the large retailer in October 2023, for a sum of £115 million. The acquisition was expected to bolster FatFace’s market position, but the immediate financial impact has been challenging.
In terms of sales, the company’s figures were reported at £191.5 million, with revenues specifically from the UK reaching £172.5 million for the period. This indicates that, despite the loss, the brand maintained a strong sales presence, particularly within the UK market.
CEO Will Crumbie remained optimistic, stating, “Against the backdrop of a challenging external environment, we have delivered a robust performance for the 35-week period.” He also highlighted the company’s strategy of focusing on full price sales, which he claimed led to improved margins and pre-tax profits. He remarked on the strong customer connection with their products, suggesting that this relationship continues to drive the brand’s enduring appeal.
The leader further noted the value of both physical retail spaces and digital platforms, underscoring their combined role in the brand’s strategy. While the financial numbers tell one story, the operational focus appears to be on sustaining a comprehensive shopping experience for customers.
The recent acquisition has posed financial challenges for FatFace, yet strategic measures aim to navigate these effectively.
