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A strategy to acquire and revive underperforming brands appears to be reaping rewards for women's specialty apparel retailer Noni B Group (ASX: NBL), with the Sydney-based company posting a 62.7% surge in EBITDA to $37.2 million in FY18.
The company attributes the result to the first full-year of inclusion for the Pretty Girl brand, as well as strong sales performance and the achievement of efficiencies throughout its operations.
Like-for-like sales were up 4.5 per cent with a particularly strong performance in the second half.
Noni B chairman Richard Facioni highlights strong financial results and pleasing like-for-like sales growth in an increasingly competitive market.
"We continued to strengthen the company's operational base, building on the expanded, scalable platform created through the acquisition and integration of Pretty Girl Fashion Group in FY2017," Facioni says.
"This has been further expanded through the subsequent acquisition of five complementary fashion brands from Specialty Fashion Group, making the Group one of Australia's leading women's specialty apparel retailers."
The acquisition of the five brands - Millers, Katies, Rivers, Crosroads and Autograph - was completed on 2 July, adding 785 stores to the group with the expectation they will almost treble revenue to approximately $1 billion. This compares to a revenue of $372.4 million in FY18, up 17.6 per cent on the prior year.
"With the successful integration of the Pretty Girl Fashion Group over the past 22 months, the team at Noni B has created a successful and scalable retail business," says Noni B managing director Scott Evans.
"With the acquisition of Specialty Fashion Group assets, Noni B Group has now become one of the pre-eminent women's apparel retailers in Australia, whilst retaining our solid, focused market position.
"The Group has made strong progress during the past four years, turning around four underperforming businesses and delivering consecutive annual like-for-like sales growth in the Noni B brand and, in-turn, the Pretty Girl brands."
Evans mentions FY18 was the fourth consecutive year of like-for-like sales growth for Noni B, with a strong response to the group's winter categories, particularly during the key weeks leading up to Mother's Day.
"Rockmans had a record year, benefiting from increased stock levels and greater focus on customer experience and store density. W.Lane and beme also had a successful year and are both well placed for further sales and earnings growth in FY2019," says Evans.
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