16th Jan 2020 10:24
(Alliance News) - Stationery supplies retailer TheWorks.co.uk PLC on Thursday reported "record" trading over the key Christmas period but said goodbye to its chief executive, who stepped down after a nine-year stint.
Effective Thursday, Kevin Keaney left his post as CEO and stepped down from the company's board.
Chief Financial Officer Gavin Peck, who took on the role in April 2018, has been named as the new CEO, also with immediate effect. He was formerly the commercial director at greeting cards seller Card Factory PLC.
TheWorks said its current Head of Finance Rosie Fordham as been appointed as the interim CFO.
Turning to its trading, like-for-like sales in the 11 weeks to January 13 rose by 1.5%.
The "record Christmas sales performance" came despite a tough comparative period, where like-for-likes rose by 4.5%, and amid tricky UK retail market conditions.
Since then, the company has been forced to increase discounting to boost sales, after reporting a "slower start" to the post-Christmas period.
For its first-half, the six months to October 27, revenue rose by 5.4% year-on-year to GBP96.4 million from GBP91.5 million. On a like-for-like basis however, sales were 3.6% lower during the period.
Its pretax loss narrowed to GBP8.5 million from GBP9.1 million last year. In November, the company warned its full-year pretax profit will be below expectations.
TheWorks held its interim dividend at 1.2 pence per share.
The company added: "The group's revenue is subject to seasonal fluctuations as a result of the Christmas period. The peak period is from October through to January therefore the first half of the year from April to October is expected to have lower revenue and results than the second half."
The company reported that its gross margins fell year-on-year during the half, hurt by the dollar exchange rate and increased discounting.
TheWorks said: "Strong control of costs remains central to the group's philosophy and culture to ensure that we are able to deliver great value to our customers whilst generating returns for investors."
"Work is underway to identify further cost savings, such as through further operational efficiencies and administrative cost reductions, to help mitigate the rise in labour costs as a result of the ongoing increases in national living and minimum wages faced by many in our sector."
The UK's national living wage, the minimum wage level payable to adults over the age of 25, will rise by 6.2% to GBP8.72 from GBP8.21 in April 2020.
Shares in the company were 10% higher at 34.25 pence each in London on Thursday morning.
By Eric Cunha; [email protected]
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