Exclusive: Fat Face profitability returns to pre-pandemic levels

In accounts covering the 52 weeks to May 28, seen by Retail Week, Fat Face reported record sales of £244.9m and profit before tax of £10.9m. 

Fat Face ecommerce sales grew 25% during the period to £95.8m with 37.9 million visits to its website, while unwinding pandemic customer behaviours and the prevalence of “staycations” in the summer saw store revenues hit £147.2m. 

The retailer also struck new partnerships with Next and Marks & Spencer during the period, which helped underlying EBITDA more than double to £25.1m. 

Fat Face also finished the year with £10.4m net cash compared to being in net debt of £10m last year.

The fashion brand also shared a trading update for the four months to October 1. Across all channels, total sales were up 9% to £92m. 

Compared with many other fashion brands looking to promotions to shift excess stock, Fat Face’s full-price sales grew during the period led by the popularity of dresses, shorts and skirts categories, resulting in an improvement to gross margin to 57%, up by 2%.

During the four months, digital sales jumped 13% while in-store revenues leapt 9%. 

North American sales for the period jumped 20%, as the retailer firmed up plans for its expansion into Canada, announcing the opening of six stores by the end of 2024. 

Chief executive Will Crumbie said: “We’ve delivered a fantastic set of numbers for the current trading period and full year, with more customers shopping with us across all channels. We’ve made great progress with our digital transformation plans as well as enhanced our partnerships with Next and M&S. Our product designs and emphasis on quality alongside our strong brand proposition are clearly resonating with our customers and our full-price approach continues to support us in maintaining healthy profitability.”

Crumbie said the brand had traded strongly over Black Friday and that key festive product categories such as knitwear, nightwear and gifting were all going well. However, he said the early months of 2023 will be more difficult for retailers. 

“Everything’s there to say it’s going to be a good Christmas. But we are also incredibly aware that the market is incredibly tough with lots of high discounting in the year, so we’ll always stay full price up until Christmas Eve,” he said. 

“I think the macro view is more difficult. But we’ve all got a very simple job to do in our industry, which is to keep designing brilliant products for our consumers that are also great value for money. We need to give the customer the opportunity to want to buy something, rather than need to buy something.”