Reiss has revealed a strong Christmas trading update, giving the fashion retailer a renewed sense of optimism after it slumped into the red last year.
Reiss finance director Steven Downes said: “Christmas trading was very good for us. We had double-digit like-for-like growth up on last year. And our margins were stronger this year than last year.”
Downes said that fashion in general is getting “back on track” in terms of promotions, returning to the traditional two Sales each year and away from mid-season Sales.
The positive festive trading followed a tough year for Reiss. It made a £6m pre-tax loss in the year to January 31, 2013 after closing stores, investing in growing its international business and streamlining its management team, according to documents filed at Companies House this week.
The loss compared with a £3m pre-tax profit the year before.
Downes said Reiss was hit by a £4.3m exceptional items charge relating to a company restructure and store closures. The company also invested in developing its website and international growth. Reiss ramped up its opening programme, which included concessions in Bloomingdales in the US. It also opened concessions in Denmark, Germany and Holland.
Reiss also “streamlined” its team by taking out a layer of senior management. Reiss promoted James Spreckley to creative director to work across menswear, womenswear and accessories to create a more integrated approach rather than have individual directors for each product department. The retailers also appointed a new global retail director and a visual director.
EBITDA fell to £7.2m from £11.2m in the year to January 31, 2013. However Downes said the retailer had “absolutely recovered profitability” at an EBITDA level in the year to January 2014. He said he expected EBITDA to double in that period. Downes declined to disclose expectations for the pre-tax profit figure.
Downes said the retailer has benefitted this year from the investment made last year. Since year end Reiss launched a new store design in three new shops in Dubai, Bluewater and Newcastle upon Tyne.
Turnover, excluding franchise retail sales, increased to £106m from £100m in the year to January 31, 2013.