Men's formalwear specialist Moss Bros (MOSB) is firmly in fashion on Friday, up 6.6% to 104.5p on a better-than-expected annual general meeting (AGM) update. CEO Brian Brick unveils sales and margin improvements in the first quarter-and-a-bit at the heritage suits and shirts seller, founded by Moses Moss in Covent Garden back in 1851.

You can read the latest update from London-based Moss Bros here. Over the fifteen weeks to 16 May, total sales strutted 6.4% higher year-on-year, including impressive like-for-like growth of 7.4%. In the core retail business including online, same-store sales were up 7.6%, ahead of analysts' expectations with a boost from new season's ranges.

Web chart - MOSB - May 15

The designer of Moss Bros' impressive turnaround whose profile was recently raised through participation in the 'Undercover Boss' TV show, Brick (pictured below) reports retail gross margin gains driven by a growing contribution from refitted stores and the earlier clearance of residual stock. Furthermore, after two disappointing years, he announces 6.4% growth in like-for-like hire sales, confirming the upturn in bookings for the 2015 wedding season flagged at the full-year stage continues.

Brick has accelerated Moss' profitability-enhancing store refit programme, while investment in IT systems and infrastructure is paying off handsomely. In fact, e-commerce sales surged almost 65% higher in the opening fifteen weeks, supported by ongoing development of the retail and hire websites. Total e-commerce sales now represent 10% of the top-line, up from 6.5% a year ago with mobile transactions increasing as a proportion of the e-commerce mix.

CEO - Brian Brick

Cantor Fitzgerald retail scribe Freddie George is maintaining his 'buy' recommendation and 120p price target and sticking with his full-year £5.4 million and 4.2p estimates for pre-tax profit and earnings respectively. He hints at upgrades to come, a possibility highlighted by Shares here in October, stating 'we believe the company is currently trading ahead of our forecast assumptions'.

George adds that 'after a year of consolidation in FY15 as a result of an increase in marketing and online costs, we are forecasting earnings growth of 15% plus per annum over the next three years. He also writes: 'The newly refurbished store recently re-opened on Oxford Street looks impressive' and notes 'the dividend yield approaches 6% with the support of a balance sheet which is forecast broadly to have £13 million of cash at end of January 2016.'

Issue Date: 22 May 2015