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N Brown swings to profit on lower costs; says margin pressure to continue

By BFN News | 08:40 AM | Thursday 25 June, 2020

Online retailer N Brown swung to a profit as cost cuts helped offset a decline in revenue as the pandemic hurt sales. For the 52 weeks to 29 February 2020, the company reported a pre-tax profit of £35.7m compared with a loss of £57.5m on-year, while revenue declined 6.1% to £858.2m. The return to profit reflected 'significantly' lower exceptional charges, which fell 80% to £28.5m. Looking ahead, the company said product gross margin pressure was expected to continue due to mix and the highly promotional retail market. Financial Services gross margin would decline as a result of previously guided regulatory pressures and an increase in bad debt provisioning due to the impact of Covid-19. 'For as long as any amount of the £50m CLBILS facilities is drawn, the group will be restricted from paying dividends. The board does not anticipate declaring cash dividends in respect of the 2021 financial year,' the company said. 'We expect our cost mitigations and significant reductions to capex (expected to be c.£20m) and exceptional costs (expected to be less than £10m) to drive improved cash generation in FY21 leading to net debt to be in the range of £380m to £400m at the year end,' it added At 8:40am: (LON:BWNG) Brown N Group PLC share price was -2.02p at 36.88p Story provided by

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