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House of Fraser enjoys sales rise helped by Chinese investment House of Fraser enjoys sales rise helped by Chinese investment
(35 minutes later)
House of Fraser has reported a sharp rise in sales and profits after being boosted by investment from its new Chinese owners.House of Fraser has reported a sharp rise in sales and profits after being boosted by investment from its new Chinese owners.
Like-for-like sales, which strip out gains from new store openings, rose by 6.5% year-on-year in the half-year to 1 August Like-for-like sales, which strip out gains from new store openings, rose by 6.5% year-on-year in the half-year to 1 August.
This included a 2% rise in like-for-like sales in House of Fraser shops and a 31% rise in online sales, which now account for 17.5% of the business. This included a 2% rise in like-for-like sales in stores and a 31% rise in online sales, which now account for 17.5% of the business.
House of Fraser, which has 60 stores in the UK and Ireland, is controlled by Chinese conglomerate Sanpower, which bought a 89% stake in the department store chain last year. The remaining 11% is in the hands of Mike Ashley’s Sports Direct. House of Fraser, which has 60 stores in the UK and Ireland, is controlled by Chinese conglomerate Sanpower, which bought an 89% stake in the department store chain last year. The remaining 11% is in the hands of Mike Ashley’s Sports Direct.
Sanpower has committed to spending £25m in store revamps over the next two years and is also expanding the brand into China with two stores. House of Fraser has already revamped shops in Huddersfield and Lincoln, and plans to upgrade key stores in the Metro Centre, Gateshead; Bluewater, Kent; Leeds and the City of London by Christmas.Sanpower has committed to spending £25m in store revamps over the next two years and is also expanding the brand into China with two stores. House of Fraser has already revamped shops in Huddersfield and Lincoln, and plans to upgrade key stores in the Metro Centre, Gateshead; Bluewater, Kent; Leeds and the City of London by Christmas.
Nigel Oddy, chief executive, said the investment meant House of Fraser had no plans to close stores.Nigel Oddy, chief executive, said the investment meant House of Fraser had no plans to close stores.
“There are no plans to expand further or take down the number,” he said of the retailer’s store estate.“There are no plans to expand further or take down the number,” he said of the retailer’s store estate.
During the period, House of Fraseradjusted earnings before interest, tax, depreciation and amortisation rose by 7% to £9.2m. Total sales reached £574m. During the period, House of Fraser adjusted earnings before interest, tax, depreciation and amortisation rose by 7% to £9.2m. Total sales reached £574m.
Oddy said the performance was driven by a 10.5% increase in menswear sales and a 7.8% rise in its home department.Oddy said the performance was driven by a 10.5% increase in menswear sales and a 7.8% rise in its home department.
However, he warned that cool weather in August had hurt sales across the retail industry. This means that the year-on-year growth in like-for-like sales has slowed from 6.5% at the end of the first half on 1 August to 5.1% now.However, he warned that cool weather in August had hurt sales across the retail industry. This means that the year-on-year growth in like-for-like sales has slowed from 6.5% at the end of the first half on 1 August to 5.1% now.
Oddy said: “We are pleased with the continued sales and profit growth in the first half of this year.Oddy said: “We are pleased with the continued sales and profit growth in the first half of this year.
“We have continued to invest in our UK business to remain at the forefront of retail innovation by developing our multichannel offering, enhancing our store portfolio, growing house brands [own brands] and introducing exciting premium brands. This focus on our key strategic pillars has also been reflected in our current trading.“We have continued to invest in our UK business to remain at the forefront of retail innovation by developing our multichannel offering, enhancing our store portfolio, growing house brands [own brands] and introducing exciting premium brands. This focus on our key strategic pillars has also been reflected in our current trading.
“We continue to make progress on our international expansion plans and remain excited by our future growth opportunities, both in the UK and abroad.”“We continue to make progress on our international expansion plans and remain excited by our future growth opportunities, both in the UK and abroad.”