Last checked at 15 Jan 2020 07:00
QUIZ Plc
('QUIZ' or the 'Group')
Christmas Trading Update
Proactive actions to manage margins and enhance cost efficiencies offset softer Christmas sales
QUIZ, the omni-channel fashion brand, announces a trading update for the seven-week period from 24 November 2019 to 4 January 2020 ("the Period").
As noted in the Group's Interim Results on 4 December 2019, we were pleased with sales across the important Black Friday week. Since that date, however, sales have softened relative to expectations and, as a result, Group revenue* in the Period decreased by 9.3%.
Online revenues comprise sales through QUIZ's own websites as well as a number of third-party websites. QUIZ continued to deliver growth through its own QUIZ websites with revenues increasing by 5.9% in the Period supported by improved full-price sell-through with less promotional activity than the prior year. As previously reported, over the past 12 months, the Group has terminated unprofitable revenue streams through a number of third-party website partners. As a result of these actions as well as weaker sales through some of the Group's remaining partners, revenues generated from third party online partners declined significantly against the prior year. This impacted the Group's overall online sales which decreased in the Period by 14.8%.
As previously indicated, during the Group's current financial year QUIZ's stores and concessions have experienced a reduction in footfall compared to the prior year. This trend continued during the Period resulting in revenue from the Group's UK standalone stores and concessions decreasing by 7.0%.
Gross margins in the Period were broadly in line with expectations. Inventory continues to be carefully managed with current levels lower than the previous year.
The QUIZ balance sheet remains strong with net cash of £10.7m as at 4 January 2020 (5 January 2019: £12.3m).
Consistent with the previously announced outcome of the Board's business review, management have remained firmly focussed on taking actions to improve gross margins, enhance efficiencies and reduce costs across the business. Given these actions and the benefits derived during the year-to-date, the business has been able to largely offset the impact on profitability of the lower than anticipated sales in the Period. As a result, the Group's overall performance in the year-to-date remains broadly in line with the Board's expectations.
Tarak Ramzan, Chief Executive Officer, commented:
"Whilst the trading backdrop has remained challenging, it is disappointing to report a decline in revenues in the Period. We were pleased that revenues through our own websites grew in the Period with less promotional activity than in the prior year, which underpins our confidence in the health of the QUIZ brand.
"We have continued to make good progress in improving gross margins and reducing costs in line with the strategic priorities set out by the Board last year. With our cash position, we remain confident that we can improve our financial performance and grow revenues. We have a clear customer focus and a flexible model that the Board continues to believe will enable QUIZ to adapt to the changing retail environment and return to profitable growth in the medium-term."
* The sales in the period and prior year comparable period exclude international franchise sales and certain third-party online partners given they are wholesale in nature and therefore, can fluctuate from month to month.
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Notes: This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.
Enquiries:
QUIZ plc | Via Hudson Sandler |
Tarak Ramzan, Chief Executive Officer Gerry Sweeney, Chief Financial Officer Sheraz Ramzan, Chief Commercial Officer |
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Panmure Gordon (Nominated Adviser and Sole Broker) Alina Vaskina / Joanna Langley (Corporate Finance) Erik Anderson (Corporate Broking)
| +44 (0) 207 886 2500 |
Hudson Sandler LLP (Public Relations) | +44 (0) 207 796 4133 |
Alex Brennan Lucy Wollam | quiz@hudsonsandler.com |
About QUIZ
QUIZ is an omni-channel fashion brand, specialising in occasion wear and dressy casual wear. QUIZ delivers a distinct proposition that empowers fashion forward customers to stand out from the crowd.
QUIZ's buying and design teams constantly develop its own product lines, ensuring the latest glamorous looks at value prices. This fast, flexible supply chain, together with the winning formula of style, quality, value and speed-to-market has enabled QUIZ to grow rapidly into an international brand with more than 300 standalone stores, concessions, franchise stores, wholesale partners and international online partners. As at 4 January 2020, QUIZ had 75 stores and 177 concessions in the UK (January 2019: 71 stores and 169 concessions).
QUIZ operates through an omni-channel, fast fashion business model, which encompasses online sales, standalone stores, concessions, international franchises and wholesale arrangements.
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For further information:
https://www.quizclothing.co.uk/
http://www.quizgroup.co.uk/