Fenwick swings to loss as it invests for future growth
Upscale department store chain Fenwick has turned in a loss in its latest year as it invested in growth initiatives in the face of a tough market.
The company’s sales fell to £355 million from £411.1 million in the year to January 25, while its operating loss was £44.2 million, down from a profit of £2 million a year earlier. Operating profit before exceptional items was £7.8 million, an 84.1% drop.
The company faced extremely challenging conditions as consumers stayed cautious and as they shifted online (an area Fenwick entered only relatively recently) but it invested heavily in its operations during the year.
A spokesperson said: “As anticipated, our full-year results reflect the tough retail trading environment in which all high street stores are operating, and also the investments we’re making to transform Fenwick, to set us firmly on the path to future sustainable and profitable growth. One year into our three-year transformation programme, we are making great progress in modernising the business in ways which will reduce costs and improve the customer experience in-store and online, where we are heavily investing and see real potential.”
The retailer has been transforming itself via that three-year plan that's being spearheaded by CEO Robbie Feather, who’s the first person at the helm of the firm not to come from the founding family.
The former Argos exec is working to get Fenwick into shape for the future and oversaw its very late entry into e-commerce in April, as well as the programme to centralise functions like buying and HR that were handled at individual store level previously.
The firm’s e-tail site launch was too late to impact the last year’s results so it will be interesting to see how it affects the current period. It sells mainly-fashion SKUs and the firm is targeting it to account for a fifth of its turnover within three years, up from a tiny percentage at present, Feather told Retail Week.
The business is also working on streamlining its supply chain and improving in-store technology, as well as investing in store look and feel, although he said that it will be taking changes to stores cautiously and adapting to local needs.
The aim is to create experience-based fashion and beauty shopping destinations with leisure options like restaurants to make a visit to one of the shops more of a day out.
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