Fat Face has posted a strong performance in its the first half as it maintained its full price strategy in the run-up to Christmas despite heavy discounting across the high street.
The lifestyle clothing and accessories retailer reported EBITDA soared 57% to £19.6m in the 26 weeks to November 30 2013. Total sales jumped 15% to £98.9m.
Fat Face chief executive Anthony Thompson put the retailer’s success down to investing in its products in the past year and said the company was now “examining an IPO in more detail” following the update. In December, Fat Face hired Lazard to explore options for the future of the business.
“Great product drove sales during the first half. Our products offer value for money and our sell-thorough was very strong. We also had a very good summer and travel locations performing very well,” Thompson said.
Ecommerce sales rose 55% during the period, with online now accounting for 14% of all sales, up from 11% last year.
Fat Face said it maintained its full price policy before Christmas, with its Sale starting as usual on Boxing Day. It said the strategy paid off, with sales for the five weeks to January 4 rising by 5% compared to last year.
The week ending December 28 proved to be a record week for the retailer, and Boxing Day was reported as the biggest single Sales day in the company’s history.
Thompson said by sticking to its guns and not discounting early, despite many retailers holding Sales in the run-up to Christmas, its customers were able to “buy with confidence and were able to buy gifts without feeling short-changed later”.
During the period, the retailer opened six new stores and relocated four others. The retailer now has 208 stores across the UK and plans to open between eight to ten new stores over the next few years.
Fat Face also paid off £19.7m of debt, with net debt now standing at £111.5m.
“Combined with the further expansion of our UK store portfolio and the rapid development of our multi-channel offer, this has led to another half-year of double digit sales and profit growth.”
He added: “We remain confident that Fat Face continues to appeal to an increasing number of customers, and we see a range of opportunities for further growth.”