The Very Group, a prominent player in the UK retail industry, recently reported a 4.9% decrease in its first-quarter group revenue, amounting to £450.2 million. This decline comes as the business grapples with a challenging market landscape.
The flagship brand of the Very Group, Very UK, which constitutes 87% of the total sales, experienced a 3.8% drop in sales, reaching £392.1 million during the 13-week period ending on 28 September. The sales performance varied across different categories, with the electrical category witnessing a 4.4% decrease and the toys, gifts, and beauty category facing a 4.1% decline. On the other hand, the home category showed promising growth, with a 2.8% increase compared to the previous year. However, sales in the fashion and sports categories decreased significantly by 8.6%.
Despite the revenue decrease, the Very Group reported a pre-tax loss of £22.9 million for the period, a stark contrast to the £5.8 million loss in the same period last year. Nonetheless, there was a silver lining as the adjusted EBITDA rose by 7.8% year-on-year to £56.7 million.
The company acknowledged the challenges posed by the retail market, especially in the fashion and sports segments. However, they highlighted the positive performance in the home category, which not only saw growth but also generated high margins. The statement from The Very Group emphasized their strategic focus on higher margin sales and cost discipline, with expectations of enhancing the profitability of the business by FY25.
Looking ahead, The Very Group remains optimistic about its future prospects. By leveraging the strength of its home category and implementing cost-effective measures, the company aims to navigate through the tough market conditions and emerge as a more profitable entity in the coming years. This strategic approach underscores the resilience and adaptability of The Very Group in the face of industry challenges, setting the stage for sustainable growth and success in the long term.
