Brown (N.) Group (BWNG)

Sector:

Retailers

Index:

FTSE Small Cap

107.90p
   
  • Change Today:
      1.70p
  • 52 Week High: 162.80
  • 52 Week Low: 85.20
  • Currency: UK Pounds
  • Shares Issued: 282.06m
  • Volume: 864,541
  • Market Cap: £304.34m
  • RiskGrade: 455

N Brown swings to interim profit but revenue dips

By Michele Maatouk

Date: Thursday 10 Oct 2019

LONDON (ShareCast) - (Sharecast News) - Specialist womenswear retailer N Brown said on Thursday that it swung to an interim profit thanks to lower exceptional costs, but revenue dipped.
In the half year to 31 August, the company swung to a statutory pre-tax profit of £18.8m from a loss of £27.1m the year before, while adjusted pre-tax profit rose 3.9% to £31.8m as total exceptional costs fell to £25m from £65.4m.

However, revenue slipped 5.4% during the period to £432.9m as product revenue from its retail business fell 9.3% to £282.3m and financial services revenue rose 2.9% to £150.6m.

The fall in product revenue was attributed to the continued managed decline of the legacy offline business, a shift in focus away from the USA and the closure of its store portfolio in the previous year. Excluding stores and the USA, product revenue was 6.2% lower.

Womenswear revenue fell 3.4% during the half as the company continued to scale back unprofitable marketing and offline recruitment. However, in line with its digital growth strategy, womenswear digital revenue was up 4.6%.

JD Williams revenue declined 3.7%, while Simply Be saw revenue grow 2%. Revenue in the menswear division, which is the Jacamo brand, rose 5.5%.

Net debt increased 14.5% to £481.6m and the interim dividend was held steady at 2.83p a share.

Chief executive Steve Johnson said: "We announced our new strategy in May to return N Brown to sustainable profit growth and we have made good progress over the first half of the year.

"In particular, we have delivered on our strategy of growing digital revenue across Simply Be, JD Williams, Jacamo and Ambrose Wilson. This has been achieved by taking a more targeted approach to marketing and customer recruitment. The retail environment remains heavily promotional, but we are concentrating on continuing to improve our customer proposition and ensuring we operate as efficiently as possible, which has led to an increase of 4% in adjusted EBITDA for the period."

N Brown backed its expectations for the full year.

At 0935 BST, the shares were up 7.9% at 107.90p.

Russ Mould, investment director at AJ Bell, said: "Half-year results now show profit going in the right direction, triggering a large rally in the share price.

"Cynics may argue that revenue is still falling, net debt is rising and the dividend is not growing. However, there is a sense that Johnson has quickly stabilised the business and put it on a stronger footing to fight back.

"N Brown has advantage over many other UK retailers in that it is catering for a specific niche so there isn't excess competition. It targets people aged over 50 and requiring size 20+. If it can offer good products and a pleasing shopping experience then there is a good chance that its customers will stay loyal.

"There are still plenty of challenges to overcome, including a reduction in relatively large levels of bad debt. A fairly chunky part of its profit comes from financial services and so it needs to reduce the risks associated with this source of earnings."

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

BWNG Market Data

Currency UK Pounds
Share Price 107.90p
Change Today 1.70p
% Change 1.60 %
52 Week High 162.80
52 Week Low 85.20
Volume 864,541
Shares Issued 282.06m
Market Cap £304.34m
RiskGrade 455

BWNG Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
98.72% above the market average98.72% above the market average98.72% above the market average98.72% above the market average98.72% above the market average
91.84% above the sector average91.84% above the sector average91.84% above the sector average91.84% above the sector average91.84% above the sector average
Price Trend
38.12% below the market average38.12% below the market average38.12% below the market average38.12% below the market average38.12% below the market average
33.33% below the sector average33.33% below the sector average33.33% below the sector average33.33% below the sector average33.33% below the sector average
Income
94.35% above the market average94.35% above the market average94.35% above the market average94.35% above the market average94.35% above the market average
68.42% above the sector average68.42% above the sector average68.42% above the sector average68.42% above the sector average68.42% above the sector average
Growth
87.48% below the market average87.48% below the market average87.48% below the market average87.48% below the market average87.48% below the market average
62.96% below the sector average62.96% below the sector average62.96% below the sector average62.96% below the sector average62.96% below the sector average

What The Brokers Say

Strong Buy 4
Buy 0
Neutral 3
Sell 0
Strong Sell 0
Total 7
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

BWNG Dividends

  Latest Previous
  Interim Final
Ex-Div 02-Jan-20 04-Jul-19
Paid 05-Feb-20 02-Aug-19
Amount 2.83p 4.27p

Trades for 17-Jan-2020

Time Volume / Share Price
16:35 43,793 @ 107.90p
16:29 17 @ 106.80p
16:28 58 @ 105.80p
16:28 176 @ 106.00p
16:28 1,902 @ 105.80p

BWNG Key Personnel

CFO Craig Lovelace
CEO Steve Johnson

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