The Very Group, a prominent online retailer of fashion and general merchandise, announced on Thursday that it has achieved strong revenue growth and is expecting to return to profit for the fiscal year 2020. This success can be attributed, in part, to the company’s new fulfilment center. Over the 12 months leading up to June 30, the group generated annual revenue of over £2 billion, representing a growth rate of more than 10%. Of particular note is the fourth quarter, which coincided with the lockdown period in the UK. Despite a decline in fashion spending during this time, Very Group witnessed a 28% increase in overall retail sales, including its Very and Littlewoods brands.

During the final quarter of the fiscal year, Very.co.uk experienced a remarkable 65% surge in website visits, resulting in retail sales growth of 36%. Additionally, the Very operation gained more than 1 percentage point of the UK non-food market share during this period. The company also saw a significant influx of new customers, with a growth rate exceeding 100% for both cash and credit customers. Interestingly, the top-selling categories during this quarter were gaming, vision, computing, garden tools/DIY, and small domestic appliances, while fashion experienced a notable decline, impacting the overall cash margin.

Despite the challenges faced by the fashion segment, Very Group anticipates that its full-year underlying EBITDA will fall within the £255 million to £270 million range, with a positive profit before tax. The company’s cash position remains robust, with £200 million in year-end cash headroom. By being able to sustain business operations throughout the lockdown period without relying on government support or loans, the company has positioned itself favorably for the future.

The opening of the Skygate fulfilment center on March 23, coinciding with the start of the lockdown, has also played a crucial role in the company’s success. With 850,000 square feet of automated warehousing space, the center allows for later cut-offs for next-day delivery, faster processing and reimbursement for returns, and the potential for same-day deliveries. Moreover, the automated technology enables products to be dispatched within just 30 minutes of an order being placed. Notably, in July, the facility processed its one-millionth outbound customer order.

CEO Henry Birch expressed confidence in the company’s adaptable and resilient business model, asserting its relevance in the face of volatile conditions and evolving consumer buying patterns. Despite ongoing economic challenges, Birch believes that Very Group is more pertinent than ever as consumers increasingly turn to online shopping. With its strong performance, the company is well-positioned to continue its success into the new financial year and is committed to investing in order to stay at the forefront of the changing retail landscape. The full results for the fiscal year will be released in the second half of next month.

Useful Links:
1. Official Website of Very Group
2. Official Website of Littlewoods