Market Cap under $80m

The market cap is currently under $80m.

From the Feb 28 announcement:
• Omni-channel strategy continues to deliver profitable growth
• EBITDA of $30.4m, up 12.7% on underlying PCP • NPAT at $12.1m, a 36.8% improvement on PCP
• Gross margin up 1.9% and store sales down 2% on a comparable basis
• Net cash of $12.3m up on PCP $1.4m
• Rivers delivers an EBITDA profit
• Online sales up 28%; now an industry leading 10.6% of total revenue
• City Chic continues to expand, locally and internationally

Gary Perlstein, Specialty Fashion Group’s CEO, said:
“This is a hard fought result, achieved in a difficult and volatile Christmas trading environment.
Our team has once again shown agility and grit to deliver improved performance against most of the key metrics we measure success by.
Our strategy of continuous business improvement to deliver profitability growth is working. While sales revenues were slightly down, margin improved due to better markdown management and holding the overall cost of doing business flat. While we have further consolidated our position as the largest specialty retailer of women’s fashion in Australia, we remain focused on increasing our efficiencies in everything we do.

Our strategy is to be the leading omni-channel retailer in our markets. Specifically, to lead in meeting the needs of women who are often overlooked by fashion - the older and plus-sized segments. Understanding our customers, and delivering a seamless and consistent online and offline customer experience across all channels, is central to our strategy. Our aim is to enable our customers to shop and engage with our brands – anytime, anywhere, any way. Online sales continued to grow, up 28% over PCP, enabled by our omni-channel growth strategy.
Our online sales of 10.6% of total sales continue to be well ahead of industry benchmarks, and an outstanding result for the retail demographic we operate in.
The result was again underpinned by strong progress against the Group’s key growth priorities: rejuvenation of existing brands across the Group; transformation of Rivers into a profitable, growing brand; and expansion into new markets beyond Australia for City Chic. Customer response to our refurbished stores continues to be strong. 14 stores across the portfolio were refurbished during the half. The continued uplift in online sales continues to be supported by a strong trend of repeat purchases by loyalty rewards customers. Given the scale of our loyalty rewards membership, this continues to be very encouraging.

Our confidence in the Rivers turnaround continues. Rivers traded profitably at an EBITDA basis for the half-year. This is a great tribute to the persistent focus and hard work of our team. The Rivers turnaround is on track, and while we feel the worst is well behind us, we will not be complacent in our focus and drive to ensure this improvement continues. We remain confident Rivers can maintain its growth momentum and achieve a much improved result this year over PCP.

There has also been some positive progress on other brands during this period. For example, the growth of City Chic continues both domestically and internationally, driven by online and wholesale. The City Chic brand continued to prove up its Myer rollout program during the half and negotiated further opportunities internationally. Overseas growth was solid, with a focus on continuing to build a multi-channel platform in the United States.
We also made significant progress during this period in improving important business fundamentals. This included continued progress in freshening inventories, and maintaining a steady cost of doing business.”

Outlook
The Group has been trading as planned since the start of the second half of FY17. The Group remains fully committed to its omni-channel growth strategy – delivering a seamless online and offline customer experience for customers of all its brands. Key growth priorities to underpin this strategy remain focused on: The Group’s brand rejuvenation program; The Rivers’ transformation into a profitable and growing brand for the Group; and The considered expansion of City Chic, both in Australia and abroad. The Group’s focus on continuous business improvements will continue, and additional benefits from this are expected.