New Look half-year sales and profits up but remains cautious for outlook

For the 26 weeks to September 27, New Look reported sales up 4.7% to £788.6m and underlying operating profit up 18.5% to £84m.

Like-for-like sales for the New Look brand were up 6.9%. In the UK, sales including ecommerce, were up 8.3% to £627.4m and UK like-for-like sales were up 8%. Ecommerce sales were up 36.4%.

New Look said despite some improvement in consumer confidence, market conditions remain uncertain and the “unseasonably warm weather in September continued through October”. As a result, it remains cautious about the outlook for the remainder of the year. However, it said “we are confident in the quality and design of our product and stores and that we are well set up for the key Christmas trading period”.

In the half year, gross margin was maintained in spite of constrained full-price sales of autumn and winter ranges in September.

It is progressing with its international plans. 14 stores are trading in China and it wants to have 20 in the country by the year end. It has also set up on the Alibaba owned T-mall site. It exited Russia and Ukraine due to political uncertainty. The roll out in Poland and Germany is on schedule.

New Look said the Mim turnaround is progressing well, and the sale is expected to complete by the year end.

New Look chief executive Anders Kristiansen said: “We are very pleased with these results which show progress across all parts of the business.

“There has been a great deal of commentary about the warm weather affecting UK high street sales and we are no different, but it is testament to the agility and responsiveness of our business, and appeal of our product that we maintained our strong gross margin in the period. Our continued focus on international expansion will help us to reduce our exposure to the UK weather in the longer term.

“We have made good progress both internationally and in terms of developing our ecommerce proposition. We have increased our presence in China, both in store and online, expanded our Polish business, launched French and German versions of our website and continued to make improvements to our online user experience.

“We are continuing to deliver on our strategic goals we outlined nearly two years ago, and we are well prepared for the Christmas trading period.”