26 Oct 2021 07:00
26 October 2021
Studio Retail Group plc
("SRG" or "Studio " or "the Group")
Trading Update
SRG, the digital value retailer, today gives an update on its trading for the first half of the financial year to 24th September 2021(1).
H1 product sales were marginally ahead of the exceptional performance seen in the prior year and up 38% over a 2-year period. Financial services revenue in H1 was 11% ahead of the prior year.
As has been well publicised, global shipping container availability and costs have been materially disrupted in recent months. The business took a conscious decision early in the summer to secure its supply chain for the crucial trading period leading up to Christmas, aided by Studio's in-house sourcing office based in Shanghai. This included use of our contracted container shipping plus additional charter ships, which gives more guaranteed stock availability. This means that overall Studio is in a strong stock position ahead of the peak with inventory levels approximately 10% ahead of last year. However, a small number of ranges have experienced delays which could impact availability late into the peak season.
The Group's core net debt ended September at approximately £20.6m (September 2020: £45.2m), with the strong H2 trading from last year and the proceeds from the sale of Education being offset by the growth in receivables and the extra investment in stock.
Studio typically delivers around 40% of its full-year product sales during the upcoming Q3 period that includes Black Friday and Christmas. Whilst the business is well positioned with a strong overall stock position, there are continuing headwinds in the wider market that make the outlook more uncertain than usual at this stage of the year.
We will provide a further update with our interims which we currently expect to announce at the end of November.
Notes:
(1) first 26-weeks in the financial year ending 25th March 2022
Enquiries
Studio Retail Group plc +44 161 303 3465
Paul Kendrick, Group CEO
Stuart Caldwell, Group CFO
Tulchan Communications +44 20 753 4200
Sunni ChauhanWill Palfreyman