Paperchase ploughs on with expansion despite profit dip

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Paperchase boss Timothy Melgund described the UK retail as “not for the faint-hearted” – and the specialist retailer’s latest full-years reflect that.

The retailer’s balance sheet was bruised, and rises in its overall sales, UK like-for-likes and ecommerce arm failed to offset a 16.2% drop in EBITDA to £9.1m

A lot can change in a year, particularly in retail. Paperchase’s full-year results in 2016 reported a healthy rise in profits and a potential float.

Although Melgund conceded that its most recent financial year was “more difficult” and that “significant headwinds” had continued into its current financial year, the business he is tasked with running is still not short on ambition.

Paperchase plans to launch its first two standalone US stores next year and is mulling further international expansion.

The retailer, which also opened 16 new stores last year, also said its rapidly growing online division continued to deliver strong sales momentum.

Also today Amazon added upmarket Northern grocer Booths to its roster of Fresh brands, Quiz posted a surge in sales at the interim mark and Dunelm first quarter like-for-likes rose, although margins suffered.

Quote of the day

“My impression over the last few years is that Karen Millen had lost its mojo and its confident purpose. Perhaps there was a misalignment between our real core customers and the collection we were offering”

– Karen Millen chief executive Beth Butterwick