19 July 2024, 06:30
By Furniture News Oct 30, 2023

Funding costs erode profits at Very

The Very Group, which operates digital retailers Very and Littlewoods, has announced its full-year results for the 52 weeks ended 1st July 2023.

Very UK revenue increased +1.9% to £1.82b (£1.79b in FY22), while group revenue was broadly flat at £2.15b. The group says that this performance was ahead of the online non-food retail market, and represents growth in market share during the same period.

Group PBT was £4.6m – a significant decrease from FY22's £63.9m – impacted by the heightened cost of funding to the company. Home sales via Very's website were down -1.4% YoY. Within the category, strong performance in textiles (+5.3%) and upholstery (+9.6%) was offset by declines in home accessories (-6.0%) and garden (-12.7%).

The business' topline performance was supported by strong Very Finance revenue growth of +6.1% to £422.1m, while the group's adjusted free cashflow increased +9.6% to £128.4m. Group adjusted EBITDA was £276.5m (£291.4m in FY22), which was impacted by pricing investment and cost inflation. Compared with FY20, group adjusted EBITDA margin was flat at 12.9%, despite the inflationary pressures.

In addition, customer experience improvements helped to deliver the group’s best-ever NPS, at 35.9 (+8.2).

Investments in technology transformation continued, including the ongoing migration of systems to a new ecommerce platform and the introduction of AI-powered product discovery across Very’s website and app.

Group CEO Lionel Desclée comments: “Despite challenging economic conditions, our adaptable business model has driven market-beating topline growth, improved cash flow YoY, and our best-ever customer satisfaction score. It’s down to the investments we made in pricing and our digital customer experience, our cost discipline, and the commitment of our people in serving families in the UK and Ireland.

“In the year ahead, we will continue to deliver a combination of investment-led growth – with a clear focus on improving our digital customer experience – and diligent cost management. While the market will remain challenging, we’re confident our proven and resilient business model, which combines multicategory online retail with flexible ways to pay, will continue to deliver for our customers.”

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