Moss Bros has returned to profit in its interim results, posting a pre-tax profit of £2.2m in the six months to July 30.
The pre-tax profit compares to a loss of £2.8m in the comparable period last year.
EBITDA grew to £4.2m compared to a loss of £0.2m last year, which the menswear group put down to improved sales and reduced head office costs.
Total sales excluding VAT were up by 17.3%. Like-for-like retail sales were up by 16.3%, while like-for-like sales at its formal hire business were up by 12.4%, meaning overall like-for-like sales were up 15.4%.
Moss Bros has a strong cash balance of £15.4m compared to £4.5m in 2010 which it said reflects the proceeds from its successful disposal of 15 Hugo Boss franchise stores and eight Cecil Gee stores.
The retailer piloted a new look Moss store at Canary Wharf ealier this year which it said has so far traded well and has achieved the anticipated sales targets. It is planning on developing and refining the key look of this store and modernising the wider store portfolio.
In the eight weeks to September 24 trading has “continued to be encouraging” with like-for-like sales strong. However the group added that gross margin has been affected by rising raw material prices.
The company said its trading performance is ahead of board expectations and is on course to deliver better than anticipated levels of growth by the end of the year but remains mindful of the fragile economy.
Chief executive Brian Brick said: “Whilst the economy has not materially picked up, the group has traded well ahead of last year across both hire and retail in the first six months of the year. This trend has continued into the second half, albeit at a lower level than the first half due to strengthening comparatives.
“We continue to make good progress on our strategic priorities of focusing investment on the look and product mix of the core Moss stores, planning our integrated e-commerce offering and exploring ways of leveraging our customer data, whilst at the same time applying careful management of our costs, to ensure we have resilience in the event that there is a further downturn in consumer spending.”
He added that the early response to the autumn 2011 range is positive, with like-for-like sales continuing to improve year on year.