Footasylum staggers to half-year loss as sales rise

The footwear specialist posted a pre-tax loss of £4m in the 26 weeks to August 25, from a profit of £2.3m during the same period the previous year, while adjusted EBITDA fell to a £1.5m loss from a previous profit of £4.4m.

Executive chairman Barry Bown attributed the retailer’s interim loss to “a lower overall gross margin from higher clearance activity in stores, as well as the extensive investments that are being made to position the company for future growth”.

Footasylum, which issued its second profit warning last month, posted a 19% increase in revenue to £98.6m, bolstered by a 29% boost in online sales to £30.2m.

The firm’s store sales rose 12% to £66.3m during the period, while its wholesale revenue shot up 200% to £700,000.

The retailer opened one new store, taking its total estate to 66 shops and plans to open a further five stores in the remaining financial year as well as increase the size of four of its existing outlets ahead of Christmas trading.

Footasylum’s EBITDA margin fell to -1.5% during the period, from 5.3% the previous year.

Bown said: “This has been a difficult trading period for Footasylum as we have contended with tough conditions on the high street and some delays in our programme of new store openings and upsizes ahead of the peak trading period.

“We are encouraged by the early results and trends that we are seeing from our investments in key areas such as digital and marketing, and see substantial opportunity for further progress across these and other parts of our operations.

“In the longer term, we remain confident that the company’s differentiated, product-led, multi-channel proposition, combined with strong partnerships with core suppliers, will underpin our future progress.”