The Works swings to a loss but hails strong post-lockdown trading
The Works swung to a loss in the last financial year due to the impact of the coronavirus crisis, but the retailer said trading had been well ahead of expectations after stores reopened.
The figures
The Works posted a loss of £18m for the year ended 26 April, down from a profit of 2.3m the previous year.
Revenue during the year was £225m, up from £217.5m in 2019.
The company reported like-for-like sales growth of 0.7 per cent.
Basic earnings per share plummeted from 1.9 per cent to a loss per share of 28.3 per cent.
The Works said it had net debt of £7.1m, compared to £3.7m in cash last year.
Why it’s interesting
The closure of all of The Works’ stores in the first seven weeks of this financial year drove sales down 26 per cent in the 17 weeks to 23 August.
Performance since the reopening of stores has been “well ahead of the board’s expectations”, with like-for-like sales increasing 0.7 per cent in the 10 weeks to 23 August.
However in-store sales have recorded a “high single digit decline” since reopening, with average transaction value growth offsetting lower volumes.
Meanwhile online sales have more than doubled since the same period last year.
What The Works said
Chief executive Gavin Peck said: “The closure of our entire store estate in March had a significant impact on our business, however we responded to the crisis with agility and were ready to bounce back once safe to do so.
“Our decisive action in response to the COVID-19 pandemic enabled us to protect colleagues and customers, meet the significant increase in online demand, and minimise the financial impact.
“We are encouraged by the trading performance since lockdown lifted and will continue to focus on improving our online capacity and customer experience in stores under social distancing as we head into peak Christmas trading.
“The current uncertainty means that we are unable to provide specific guidance. We will continue to monitor the situation closely and remain agile ahead of our key trading period.”