Vivienne Westwood to cut costs as Brexit's weak pound bites into profits
British designer Vivienne Westwood said sales for the year to 31 December 2016 increased by 11%, but margins were under pressure due to the challenging conditions in the retail market and the weak pound following Brexit.
During the period, the company saw a 37% increase in wholesale sales and a 5.3% rise in retail sales, lifting its full-year turnover to £37.5 million, compared with turnover of £33.7 million a year earlier.
Vivienne Westwood said the brand “continues to remain attractive to its wider customer base as sales growth demonstrates”. However, the company suffered a dramatic drop in pre-tax profit, sliding to £1.9 million from £2.3 million in 2016.
It attributed the decline in profitability to a 19% increase in cost of sales due in part to the weak pound following the EU referendum. As a result, it is focussing on alleviating this pressure by reviewing pricing and committing to a policy of cost tightening.
The brand is also undergoing a strategic review of the business aimed at creating a new operating structure. It said this will allow it to optimise processes and the overall efficiency of the business.
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