Matalan ‘very cautious’ over impact of latest lockdown as Christmas sales drop
Budget fashion retailer Matalan warned that it is “very cautious” about the coming months due to the ongoing impact of coronavirus, as it announced a drop in sales over the crucial Christmas trading period.
In the five weeks to 2 January, total UK revenue was £119.2m, down from £134.3m in the previous year, as the firm was forced to close 92 stores during December due to the government’s Covid-19 tier system.
An 84 per cent surge in online sales during the period was unable to offset the impact of store closures in the run up to Christmas.
Meanwhile, Matalan’s Boxing Day sale entry volume was 14 per cent below last year.
The firm said total revenue in the 13 weeks to 28 November fell to £244.8m, down from £311.7m the previous year.
Earnings before interest, tax, depreciation and amortisation (Ebitda) reached £28.8m, compared to £33.7m.
The retailer said it remained “very cautious” about the months ahead due to the closure of stores for an “uncertain duration” in the latest national lockdown, which began on 4 January.
Matalan executive chairman Steve Johnson said: “Today’s results reflect the severe Covid-19 related disruption to store trading throughout November as Government restrictions required us to close completely or trade only “essential” ranges within stores”.
Matalan said it is working with “key stakeholders”, and focusing on online performance, cash preservation, working capital management and minimising costs.
Johnson added: “Our experience of re-opening our stores following a lockdown gives us confidence that we can once again trade well in what will undoubtedly continue to be a tough retail environment.”