Matalan’s EBITDA nearly halved in its last financial year, after its customer proposition was “severely challenged” due to warehouse issues.
EBITDA at the discount fashion and homeware retailer decreased 44% from £100.3m to £56.2m in the 52 weeks to February 27 2016.
Sales dipped, going from £1.09bn to £1.06bn, a drop of 3%.
Matalan managing director Jason Hargreaves said: “In line with the update provided in January, the full-year results issued today reflect the scale of the operational challenges encountered with last year’s warehouse transition.
“As a consequence, the overall proposition delivered to customers, both in stores and online, was severely challenged and margins were significantly eroded.”
Hargreaves explained that the warehouse is now operationally stable and store availability is back to normal levels. However, Matalan is still working on restoring online service levels and delivery options.
He added: “Having faced into the problem, we closed the year with clean stocks and are well positioned to continue to improve our mix of full-price sales and margin. While the market remains challenging and volatile, we are clear and focused on our recovery plan and cautious in our planning.”
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