Specialist clothing retailer N Brown (BWNG) highlighted progress in its transformation to a digital-only operation as it released half-year results to 31 August.

Talk of digital transition helped drive the share price 7% higher to 107.05p.

Chief executive Steve Johnson said, ‘In particular, we have delivered on our strategy of growing digital revenue across Simply Be, JD Williams, Jacamo and Ambrose Wilson.  This has been achieved by taking a more targeted approach to marketing and customer recruitment.’


The company closed all of its stores last year and now has ambitions to grow digital sales and generate free cash flow which will be used to pay down net debt as well as invest in the business.

In the first-half Womenswear saw digital growth across all brands, with Simply Be up 4%, JD Williams also up 4% and Ambrose Wilson the star performer, up 10.5%. The menswear brand Jacamo saw 6.6% digital growth. Overall digital represents 80% of sales, up 4% on last year.

A focus on simplifying the business and a renewed focus is starting to pay-off as demonstrated by the company generating positive operating cash flow of £29.7m against a loss of £22.3m last year.


The company achieved higher operating margins of 9.2% (8.1%), aided by operating expenses falling by a tenth, the result of moving to an online model.

N Brown has a significant financial services arm providing credit to its customers, which amounted to £658m, down slightly from last year. Revenue increased by 2.9% which resulted in a 5.6% increase in gross profits to £86.5m.

The company’s provision for bad debts fell by 4.6% to 11.9% due to an improvement in the quality of the loan book.

The company still has a lot of work to do to bring its ambitions into reality but the share price reaction suggests the market is warming to its future prospects.

Broker Shore Capital concurs, commenting ‘ we see this as a very pleasing out-turn in challenging markets. As the plan both evolves and is expedited, we can more clearly foresee management’s ambition to generate sustainable free cash flow becoming a reality.



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Issue Date: 10 Oct 2019