FatFace sees “exceptional year” ahead of takeover by Next

Fat Face Limited — which is being acquired by Next — has filed its accounts for the 12 months to the end of May and called it an “exceptional year”.

The company behind the FatFace brand saw record sales and its store estate “exceeded expectations”, while digital sales – including those through partners – continued to grow. 

The B Corp certified lifestyle brand said it achieved it all despite the external economic headwinds as revenue increased to £270.9 million from £234.9 million in the previous year. 

Operating profit before interest, tax, depreciation, amortisation and impairment was up to £20.2 million from £8.9 million. The company said this rise reflects the improved trade, but also shows a reduction in margin from input price pressures and inflation. 

Reduced fixed asset impairments and the change in the group transfer pricing policy reducing the royalty charge for the year also had a positive impact on its profit. It all meant that profit after tax rose to £15.4 million from £5.2 million.

The fact that digital sales were up is important as the company is aiming to create a digital-first business with a mix of at least 60%. Its digital revenue in the last year accounted for 39.5% of the total from 42.8 million website visits, up from 38.8% in the previous year and 37.4 million web visits.

The company is working on continuous improvement to optimise the on-site experience and support digital self-service. It’s also working on enhancing its delivery and fulfilment solutions and is targeting further growth through third-party digital retailers. The acquisition by Next will clearly be important here given the plan to move to the Next Total Platform within 12 months. Additionally, it’s planning to develop the user journey with a mobile-first focus.

But it will remain an omnichannel retailer with plenty of attention paid to its physical spaces too. Its UK stores are currently the largest part of its business. It has 180 of them at the moment compared to 193 a year earlier as it focuses on the most profitable locations.