Hackett, the renowned British luxury menswear brand, has experienced a notable decline in sales during the last financial year, primarily attributed to the far-reaching impact of the COVID-19 pandemic. The company’s UK turnover dropped by almost 8%, amounting to £97.9 million, which led to a significant shift from a profit of £4.9 million to an EBITDA loss of £3.9 million compared to the previous year. Additionally, the brand reported an operating loss of £21.5 million, considerably higher than the £6.7 million loss in the prior year, as well as a net loss of £22.2 million, marking an increase from £7.7 million.

While the decrease in turnover can largely be attributed to a reduction in sales within the wholesale business, there were some positive developments in Hackett’s directly operated retail sector. The company successfully opened its new luxury destination in Savile Row and made the decision to close its unprofitable Spitalfields store. However, the retail sales were negatively impacted by the pandemic in the final two months of the financial year. Full-price stores experienced a 9% decline in sales, although this decline was partially offset by a 2% increase in outlet store sales. By the end of March, all of Hackett’s 11 full-price locations in the UK, six outlet stores, and one concession had been temporarily closed due to the lockdown measures imposed.

Interestingly, Hackett revealed that its e-commerce sales, after accounting for returns, also faced a decline of 6%. However, it is worth noting that in the previous year, e-tail sales had experienced a staggering surge of 67.5%, indicating that they were still performing relatively well compared to two years earlier. The decline in e-commerce sales can be mostly attributed to the overall impact of the pandemic. Despite the decrease in sales, Hackett witnessed a 5% increase in e-sessions and an 8% improvement in conversion rates, which the company attributed to the successful enhancements made to its website.

In recent times, Hackett has been in the process of implementing a comprehensive transformation plan, targeting the further development of its online sales and the optimization of its wholesale, franchise, and retail channels. However, due to the unprecedented challenges posed by the COVID-19 pandemic, the company has had to adapt its plans accordingly. Hackett’s current focus is on minimizing costs and closely monitoring its credit situation. Although facing these obstacles, the company emphasizes that its parent firm, Pepe Jeans, remains fully committed to providing support to Hackett throughout this difficult period.

Useful links:
– For more information on Hackett, visit their official website: https://www.hackett.com
– To learn about the impact of the COVID-19 pandemic on the retail industry, refer to this article: https://www.bbc.co.uk/news/business-58568175