(Press Association) Fashion retailer AllSaints has shrugged off a slide in full-year earnings, as costs linked to its international expansion and tech investments paid off with a 20% jump in annual sales.
The UK company reported a 9% drop in earnings before exceptional items to £26m for the year to January 28, which marked a sharp decline from the 18% jump to £28.5m it booked a year earlier.
But AllSaints defended the results, saying they reflected start-up and pre-opening costs linked to its Japanese launch, as well as “strategic” investments in technology and its new travel retail outlets.
“We don’t see it as a disappointment,” chief executive William Kim said.
“Take a look at Amazon – for every growth they have, what do they do? They reinvest it back into the company and the model. We’re no different.
“Since 2012 what we’ve been set to do is build a future-proof model. When you’re building a future-proof model, it takes investment.”
Chief executive William Kim has defended investment and expansion costs (AllSaints/PA)
The decision has helped propel a 20% jump in sales to £303m for the period, with digital revenues making up around 19% of the total business mix at £57.4m , while international sales account for £142.2m or 47%.
International revenues alone were up 31% on an annual basis, driven by continued growth in North America and Asia.
AllSaints – which has been owned by private equity firm Lion Capital since 2011 – has been reconfiguring the business over the past five years, which has involved closing select stores and product lines, while investing in distribution centres and digital platforms as well as international expansion in the US and Asia, including Taiwan, South Korea and now Japan.