New Look back in the black following CVA

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New Look has returned to profit despite the impacts of the pandemic on physical stores.

New Look recorded statutory profit before tax of £108m for the 52 weeks to March 27 2021, up from a loss before tax of £430m the previous year.

The retailer also reported revenues of £542m for the full year, down 40% year-on-year due to enforced store closures amid the coronavirus pandemic.

New Look said that its total store estate was open for just seven weeks of the financial year, but its online sales rose 69% during the same period, offsetting some losses.

The embattled fashion retailer also successfully completed a refinancing in 2020, launching a company voluntary arrangement (CVA) to close some of its least-profitable stores.

For the 13 weeks to June 16, New Look said it was “pleased by the full-price sales” now generated through both stores and online, with total revenue up 181.7% to £194.4m compared with the same period in FY21.

The retailer has been making investments in its digital strategy, including the appointment of former BP executive Ed Alford in the newly created role of chief technology officer.

New Look boss Nigel Oddy said: “We have been delighted to welcome our customers back to our stores since reopening from April 2021, which, as expected, has driven strong sales growth as lower footfall has been offset by improved sales conversion rates.

“We are focused on driving profitability and are pleased by the full-price sales we are now generating in-store and online as customers react positively to our spring-summer ranges.

“When the weather became warmer, seasonal product sold strongly, particularly dresses and sandals. It was also especially pleasing to maintain momentum in ecommerce, with year-on-year sales growth since our stores reopened, despite the strong prior year comparator.

“Customers are coming back to our brand and when they do, they clearly like what we have to offer, especially when they shop across both stores and online.

“Last year’s results are clearly not reflective of the health of the business as it stands here today. We are in a fundamentally stronger position following the successful recapitalisation and CVA.

“We can now look to the future with confidence and leverage our brand position as a leading broad-appeal fashion destination which has been loved by customers for over 50 years.”