Fashionable revenue rise for Glasgow retailer Quiz

Quiz, the Glasgow-headquartered fashion retailer, has posted a solid hike in revenues while acknowledging the 'challenging' economic backdrop.
But City analysts warn that outlook is likely to remain tough for group. Picture: Quiz plcBut City analysts warn that outlook is likely to remain tough for group. Picture: Quiz plc
But City analysts warn that outlook is likely to remain tough for group. Picture: Quiz plc

Reporting results for the six months to the end of September, the firm said overall sales had increased by 19 per cent period, year-on-year, to £66.7 million driven by continued growth across all channels.

Revenue from UK stores and concessions increased 9 per cent to £35.1m while online takings leapt 44 per cent to £20m. International sales were up by 16 per cent to £11.6m. The firm noted that online sales now represented about 30 per cent of group revenues.

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Earnings before interest, tax, depreciation and amortisation (Ebitda) rose 11 per cent to £5.6m, though on an underlying basis they dipped 2 per cent while underyling profit before tax slid 11 per cent to £4.2m.

During the period, two further stores and thirteen concessions were opened by Quiz, which floated on London’s junior Alternative Investment Market in July 2017. It also successfully launched its Quizman range while a second Quiz X Towie collection was rolled out supported by the brand’s first ever national TV advertising campaign.

Founder and chief executive Tarak Ramzan said: “Quiz has continued to deliver good revenue growth in the first half of the financial year despite challenging external market conditions.

“This performance was driven by further expansion across each of the brand’s distribution channels with particularly strong sales generated online through Quiz’s websites.

“The Quiz brand continues to grow, and we have seen good sales momentum in our core collections as well as across extended ranges. Towards the end of the period we launched our second collaboration with Towie supported by the group’s first ever national TV advertising campaign.

“Quiz has a clear customer focus, a proven ‘test and repeat’ model and a dedicated management team. With these strengths, and despite a challenging market environment, the board believes the group is well positioned to deliver long-term profitable growth.”

The company had issued a profit alert in October, resulting in its share price taking a hit.

John Moore, senior investment manager at Brewin Dolphin Scotland, said: “Quiz has seen growth in sales across its different formats. But the difficult retail trading environment has impacted bottom-line profitability and cash generation.

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“In addition to what has been reported, there remain concerns that troubles at other retailers could cause problems for Quiz – it has already taken a hit from House of Fraser’s collapse and others could follow.

“Nevertheless, the main concern in the City centres around the company’s ability to generate enough cash to be self-sufficient and to deal with industry blows before it’s in a position to fund future growth potential.”

Analysts at Shore Capital noted: “In our view life remains pretty tough for Quiz given high street conditions, particularly in the concessions stores.”