Monsoon is facing stormy weather after an almost-19% profits plunge. That news was bad enough but the UK-based fashion and accessories retailer warned of …
Monsoon is facing stormy weather after an almost-19% profits plunge. That news was bad enough but the UK-based fashion and accessories retailer warned of more pain to follow and said it is to close stores, cut costs and revamp its online ops.
Full-year group ebitda before exceptionals slipped 18.7% to £50.6m as group turnover fell 7.8% to £509.1m.
And the problem behind all this? Nothing we haven’t heard from so many other retailers in recent months. Firstly, trading was weaker across both its UK and international businesses, partly due to unseasonal weather patterns and you cam probably guess the second reason – those adverse foreign exchange movements in a number of markets.
Founder Peter Simon said the group, which also owns the Accessorize chain, had endured a “challenging year”. He added: “The performance of the Monsoon ladies brand was particularly disappointing, and although much of this was due to the unseasonal weather conditions, we have work to do here to improve the ranges.”
Simon ousted CEO John Browett in February after just two years. Paul Allen, the former head of fashion label Jacques Vert, has been running Monsoon in the interim.
Allen said he was undertaking a two-year “strategic transformation programme” that would aim to strengthen the Monsoon brand and clothing ranges, reduce costs and tackle underperformance overseas.
“We expect these actions to bear fruit over the next two years, although there will be an inevitable cost in the current year, when we expect a further fall in profitability,” Simon admitted.
Simon added: “Our strong balance sheet enables us to carry out this fundamental investment and restructuring over time to be able to capture the maximum benefit.”