Theo Paphitis Retail Group has revealed positive like-for-like sales and margin growth over Christmas and the full year.
High profile businessman Theo Paphitis is the chairman of hardware and housewares chain Robert Dyas, chairman of high street stationery specialist Ryman the Stationer, and owner of lingerie chain Boux Avenue.
In total, Theo’s Retail Group includes almost 350 stores nationwide, with 3,600 employees serving over 28 million customers a year.
Robert Dyas joined Theo’s retail portfolio in July 2012. With 95 stores mainly in the south, it saw a sales decline of 2.5% in the Christmas trading period (six weeks to December 24), following strong growth over the last three years. However, gross margins increased.
Theo Paphitis said: “Despite the widely reported decline in footfall and challenging trading conditions in retail during November and December, I’m delighted that our Group was able to deliver positive like-for-like sales in Boux Avenue and Ryman and improved gross margins for all three of our brands.
“Across our Group businesses, we decided to focus on the factors that we could influence being conversion of visitors into spending customers and maximising the amount they spent with us in store and online.
“The development of Black Friday in UK retailing was predominantly an online event and had a further effect of disrupting the consumer’s purchasing habits, which took time to recover.
“Adding this to the difficult trading conditions, coupled with unseasonal weather, retailers were competing hard for consumer spend, with discounting appearing to feature prominently throughout the seasonal trading period.
“Having planned our promotions and offers, we decided to resist discounting further to protect margin and this resulted in increases in our margins across the board.
“This supports our belief that by delivering good product and customer service, together with convenience, customers will engage with our brands.
“A great deal of focus and investment has been made – particularly over the last 18 months – and will continue to be made, in developing our businesses to meet the changing demands of our customers and the way they wish to shop with us.
“A new distribution centre was commissioned at Hemel Hempstead that became operational in May 2015, which included bringing in-house a third party warehouse and distribution centre that was in place when we acquired Robert Dyas. This also included the implementation of modern systems to provide a platform for Robert Dyas to grow from current regional gross sales of around £150m to over £250m nationwide.
“The facility now also supports our other Group companies and it will further allow us to meet the growing demand for Click and Collect across all our shops, irrespective of brand or where the purchase originated from.
“The restriction of the previous facilities, as well as the disruption to the business and Group in establishing and migrating to the new warehouse, has had a short term impact this year, particularly for Robert Dyas.
“The warehouse is now fully operational with increased efficiency and capacity, placing us in a good position to deliver the ambitious plans we have for our three brands.
“This will involve increased investment in the next 12 months to further enhance our online proposition which will also include upgrading our tills, giving us seamless, true, real-time multi-channel multi-brand ability.”
For the year ending March 28 2015, turnover for Robert Dyas increased 1% from £124.2m in 2014 to £125.5m, with like-for-like sales of 1%. Underlying EBITDA increased by 12% from £6.25m in 2014 to £7m and net assets were up to £14.2m. A total of £3.6m exceptional costs were incurred relating to establishment of the new warehouse in Hemel Hempstead.