Brown (N) Group PLC has released its interim results for the 26 weeks ended September 2, 2023. The company reported a 10.4% decrease in group revenue compared to the same period last year, reflecting challenging market conditions, including unseasonable weather. Product revenue declined by 11.2%, while financial services revenue was down 9.0%. However, the company's adjusted gross profit margin increased by 0.4 percentage points to 47.6%, driven by improvements in product margin rates and a lower level of arrears in financial services.
Despite the macro-economic challenges and higher costs, Brown (N) Group PLC's adjusted EBITDA performance for the first half of the year was in line with the board's expectations. The company reported an adjusted profit before tax of £0.1 million. The statutory loss before tax includes adjusting items of £4.5 million related to restructuring activities. The company has continued to deliver strategic and operational progress, including the successful launch of a new mobile-first website for Jacamo and improvements in Net Promoter Score.
Brown (N) Group PLC has successfully offset cost inflation through ongoing mitigating actions, resulting in a reduction of adjusted operating costs by £4.7 million. However, there has been an increase of 2.9 percentage points in adjusted operating costs as a percentage of group revenue due to cost base inflation in the second half of 2023. The company has a robust balance sheet and available liquidity, with net cash generation of £13.6 million in the period and total accessible liquidity of £133.1 million.
Looking ahead, Brown (N) Group PLC expects its full-year adjusted EBITDA to be in line with market expectations. The company anticipates that macro-economic challenges, such as high inflation and low consumer confidence, will persist throughout the year. However, the benefits from cost actions taken in the first half of the year are expected to mitigate the impact of slightly moderated full-year revenue expectations. The company remains confident in its strategic direction and the benefits of its ongoing investment in digital transformation.