Paul Smith has reported a significant improvement in its financial results for the year ending in June. The company credits this recovery to the successful measures taken during the Covid-19 crisis and the increased demand for its products following the easing of restrictions.

Despite challenges such as rising inflation and low consumer confidence, Paul Smith Group Holdings Limited, the parent company of the brand, saw a strong recovery. Group turnover increased by 22% to £197.35 million, with higher volumes, stock efficiencies, and increased sales at full price contributing to an improved gross margin. Gross profit rose to £99.2 million, and the operating profit before exceptional items was £5.6 million compared to a loss of £3.1 million in the previous period.

Retail sales for Paul Smith increased by 35% overall and 41% on a like-for-like basis. AW21 retail sales were up 36% compared to the previous autumn/winter season and rose 35% on a like-for-like basis. However, they were down 6% on a like-for-like basis compared to the pre-pandemic autumn season. SS22 retail sales saw a healthy increase of 49% year-on-year and 41% on a like-for-like basis. Additionally, they were up 1% compared to SS19. AW22 retail sales were up 11% compared to the previous year but down 5% on a like-for-like basis compared to AW19.

Although e-commerce sales saw a decline of 11% compared to AW21, they are up by 47% compared to AW19. E-commerce sales accounted for 34% of the company’s retail sales, down from 51% in the previous year when physical stores were closed due to the pandemic.

Paul Smith considers e-commerce to be an important channel for its business and expects its momentum to continue based on current trends. The company has also seen growth in its tailoring categories and increased footfall in some of its larger shops.

In terms of store portfolio, the company has closed one location in Birmingham, UK, and one in Paris, France, while opening a new store in Williamsburg, New York, and relocating a Hong Kong location to IFC Mall.

The wholesale segment of the business has also seen a recovery, with wholesale sales increasing by 12% to £82.6 million. Forward orders for SS23 have increased by 4% compared to SS22, and are even 1% higher than SS20.

Overall, Paul Smith’s results demonstrate a strong recovery, with increased sales, a steady progression in e-commerce, and a positive outlook for the future. The company’s ability to adapt and navigate challenges has positioned it well for continued success in the post-pandemic retail landscape.

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