Moss Bros chief executive Brian Brick has labelled its recent profit warnings as “a blip”, as the retailer seeks to move on from its “self-inflicted” stock problems.
The retailer issued its second profit warning of the year last week after “material short-term issues” with stock availability, which it aims to resolve later this spring.
Brick told Drapers: “We know our stock issues were self-inflicted and we will move on from that by the end of April. Our product is selling well so it’s not a question of whether we have the right product – we just don’t have enough of it in our stores.
“We’re not uncomfortable – we’re obviously disappointed after nine years of straight growth – but we’re confident our strategy will get Moss Bros back to where it was.”
Moss Bros halved its core suit supplier base from four to two last year, to mitigate the effect of the weak pound after the Brexit vote. The group manufactures in China and Vietnam.
After putting extra volumes through these factories, the retailer developed problems with supply and goods that it had hoped would ship before Chinese New Year.
The retailer’s preliminary results showed profit before tax dropped by 6.1% year on year to £36.7m in the period between 29 January 2017 and 27 January 2018. EBITDA fell 2.2% to £13.3m.
Total group revenue excluding VAT grew by 3% to £131.8m during the year. Group like-for-like sales including VAT inched up by 1.6% to £137.3m.
Moss Bros plans to grow its ecommerce business, continue its store refurbishment programme and focus on product development in the year ahead.
It will also accelerate changes to its hire service, which will account for a “much lower” percentage of sales, than the current 13.9%.
Brick noted: “The sentiment on retail isn’t that positive at the moment; there are a lot of companies struggling, and CVAs in the clothing retail and restaurant sectors.
“It is not going to be the easiest year ahead [or] an easy market, but a lot of retailers like ourselves have been at it for a long time. We have an exceedingly strong balance sheet. It’s a tougher market than it was but Moss Bros is in a very good position to take advantage of it.”