Rugby World Cup 2015 and faster delivery times helps House of Fraser as half-year sales jump

 
Kasmira Jefford
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Online boost for House of Fraser as half-year sales jump (Source: Getty)

Department store chain House of Fraser has hailed a jump in sales over the first half, boosted by further improvements to its online offer including faster delivery times.


The company, which was taken over by Chinese consortium Nanjing Xinjiekou last year, said like-for-like sales were up 6.5 per cent, with gross total value (GTV) rising to £574.2m in the six months to 1 August.

Profits rose £11.3m to £204.7m, while adjusted EBITDA rose seven per cent to £9.2m.

Online sales were the star performer, after surging by 30.8 per cent. They now make up 17.5 per cent of total sales compared with 14.2 per cent the same time last year.

The retailer said shoppers now have until midnight to buyonline and collect in store by midday the following day. It has also updated its iPhone app so that shoppers can now scan barcodes in-store and buy proucts on their phones.


Underlying bricks and mortar sales also rose two per cent as it continued to spruce up its stores and introduce new ranges such as Polo Ralph Lauren in womenswear.

Nigel Oddy, who who replaced John King as chief executive in February, said: “We are obviously delighted with the continued sales and profit growth in the first half of this year. Both stores and online have delivered positive sales and margin growth, building on the performance we have seen in both these channels in recent years, demonstrating the truly multichannel nature of our business."

The company last year decided to pull out of house brands for furniture and lingerie after both proved costly to operate, and focus on clothing instead. House brands were up by just 2.1 per cent as a result, while branded goods and concessions were up by seven per cent and 6.7 per cent respectively.

Under its new owners, House of Fraser plans to crack the Chinese market with its first store due to open in Nanjing next year. The group also opened a second franchise store in Abu Dhabi in June and is in talks to enter another Middle Eastern market. It has also agreed to anchor a new shopping complex in Rushden Lakes in Northamptonshire opening in 2017.

The retailer is revamping its stores in the Metro Centre, the City, Bluewater and Leeds ahead of Christmas and will refurbish another six to eight stores in the second half.

Oddy said August trading had been challenging but the group had seen a bounce back in September, helped by demand Rugby World Cup-related products such as Howick rugby shirts. Like-for-like sales have risen by 5.1 per cent in the year to date.

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