FatFace slims down workforce as brand returns to profit
FatFace shed almost 300 jobs as it returned to profit in its first full year after being acquired by FTSE 100 giant Next.
The retailer was snapped up by the Leicester-based group for £115.2m in October 2023 in a deal which saw it fall to an initially reported pre-tax loss of £3.2m in the 35 weeks to 27 January, 2024.
That number has since been revised to a pre-tax loss of £5.3m.
FatFace’s bottom line was hit by exceptional costs of £7.9m in that period – the majority relating to its acquisition by Next and integrating into its systems.
However, new accounts filed with Companies House have revealed the brand returned to the black after posting a pre-tax profit of £3.8m for the 12 months to 25 January, 2025.
Its revenue also increased from £191.5m to £236.3m in the year but the results also show that FatFace’s headcount reduced over the same period from 2,721 to 2,412.
FatFace’s UK turnover jumped from £172.5m to £217.3m in the year and from £4.6m to £5.3m in the Republic of Ireland.
Its sales fell from £14m to £12.1m in the USA but rose from £1.3m to £2.5m in Canada.
During the year the number of full price FatFace stores in the UK dipped from 179 to 175 and fell from 33 to 22 in North America.
The new accounts also confirm that FatFace issued a dividend of £8m to Next, up from £1.9m.
Year of ‘evolution’ for FatFace after Next deal
In a statement signed off by the board, FatFace CEO Will Crumbie said: “We have made good progress this year in executing our strategy and financial objectives.
“We continued to focus on full price sales, with a strategic approach to discounting at specific times of the year.
“Our store network continues to be a core part of our offer with new stores opened in the year.”
He added: “Looking ahead, we will continue to harness the fundamental strengths of the FatFace brand and business to drive our performance further.
“This means never compromising the quality of our products, being laser focused on our multi-channel offering, all the while remaining dedicated to sustainability.
“Our focus now is on growth; growing our customer base in the UK and beyond while staying true to our brand values.”
The CEO of FatFace also said: “Despite the external economic headwinds and internal changes, the business has continued to make good progress against our strategic objectives.
“The year has been one of evolution – we have migrated our operational systems, realigned our trading stance to focus on full price sales and reduced the overall number of terminal stock units in the business.
“While in the short term this has had a financial impact, ultimately it will set the business up for long-term success.”