CCX’s half year update revealed elements of the extent to which...

CCX’s half year update revealed elements of the extent to which the CCX branded product, weighted towards formal dress, was smashed in the US due to Covid.

The complete delisting from partner e-commerce and marketplace websites also gave colour on the weakness of these forms of distribution channels; sales nearly fell to zero, annihilation in a true sense.

Whilst CCX branded product was hit on the way into Covid, the reverse should apply on the way out. A restart of formal social gatherings over the next year is likely to provide an underlying boost to demand. US sales will also be comping at a higher exchange rate in the later part of this calendar year, but sales will again be hit by it in the second half of the 2021 financial year.

The additional spend on marketing is an interesting one. Is it the new norm, or elevated to counteract Covid pressures?

Further, having spent $45million on Evans which will contribute very little if anything to profits in the first year of its acquisition is another turnaround task management has on its plate, front and centre.

Brokers and the market have generally given the executive team and the Board the benefit of several doubts for now. The task is clearly ahead of them to achieve good progress and to keep their good reputational regard, along with truly earning the lucrative shares under plans issued to them.