LONDON (ShareCast) - (Sharecast News) - Clothing and footwear retailer N Brown Group updated the market on its first quarter of trading on Thursday, with product revenue slipping 0.6% year-on-year to £106.3m.
The AIM-traded firm said of that, revenue from its 'strategic' brands was up 2.5% to £75.2m, while its 'heritage' brands saw revenue slide 7.2% to £31.1m.

Financial services revenue was 4.8% weaker at £58.8m, with total group revenue narrowing by 2.1% for the 13 weeks ended 28 May, to £165.1m.

N Brown said clothing and footwear demand was driving its performance, with the home and gift sector remaining "soft".

The company said it maintained a "strong" balance sheet, with unsecured net cash of £30.8m at period end.

Its securitisation facility was voluntarily underdrawn by £66.6m, and could be redrawn if required, while its revolving credit facility of £100m and overdraft of £12.5m were both fully undrawn.

The firm's earnings expectations for 2023 remained unchanged, with adjusted EBITDA expected to remain at a level similar to the 2021 financial year.

Its board said it was "mindful" of the "high level of economic uncertainty" and the impact of that on consumer activity and operating costs.

However, those dynamics were being "actively managed", while the board remained confident that over the medium term, its strategy would support the delivery of 7% product revenue growth with a 13% EBITDA margin.

"Sales volumes since the start of the financial year have been softer, reflecting various well-documented pressures on consumer confidence, which are showing no signs of abating in the short term," said chief executive officer Steve Johnson.

"As these pressures persist, we expect the trading environment to remain challenging and will, therefore, continue to take actions to mitigate the effects wherever possible."

Despite the uncertain backdrop, Johnson said the company's adjusted EBITDA expectations remained in line with previous guidance, as it balanced cost control and its variable cost base with investments in technology, people and its strategic brands.

"The board remains confident in the group's strategy and achieving its medium-term objective of delivering sustainable profitable growth."

At 0934 BST, shares in N Brown Group were down 3.23% at 27.58p.

Reporting by Josh White at Sharecast.com.

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