Global sales for Australian plus-size retailer City Chic were $69.5 million in the first half of FY25, down 3.6 per cent on the first half of FY24.
The drop in sales was driven by a 22.4 per cent plummet in the Americas market, offset by a 2.8 per cent lift in Australia and New Zealand.
Despite the overall slip, both markets improved in the last five weeks to December 29, 2024. City Chic’s ANZ market bumped up by 9 per cent, following a modest 0.8 per cent rise in the first 20 weeks of FY25.
Meanwhile, its US market recorded a 24.7 per cent fall in sales for the first 20 weeks of FY25, which improved to a 15.1 per cent fall in the last five weeks to December 29.
With the improvements in the last portion, City Chic recorded a 3.2 per cent rise in overall sales for those last five weeks.
City Chic CEO and managing director Phil Ryan added that the turnaround is also noted in earnings, with EBITDA expecting to hit between $3 million and $4 million, a green swing from a $4.4 million loss in the first half of FY24.
Much of this is driven by the ANZ market, which makes up 80 per cent of the retailer’s revenue, alongside continued growth in its online channel that makes up 50 per cent of total revenue.
“The ANZ recovery is particularly pleasing as this was one of our key strategic priorities leading into FY25,” Ryan said. “Our store and online business built strong momentum leading into the holiday period and delivered robust results from Black Friday through to the Christmas and Boxing Day trade. We expect this momentum to continue into H2.
“Additionally, our new summer product has been well-received and the increase in sell price has contributed to materially stronger margins.”
City Chic also reported continued trading margin improvements in all regions, with an 8.5 per cent lift in gross margin dollars against the prior corresponding period.
Meanwhile, the retailer’s inventory is at $32.1 million, down from around $39.5 million recorded last year, with a net cash position of $12 million.
Ryan said City Chic new has the team in place to drive further recovery in ANZ, and unlocking opportunities in the USA will become his primary focus.
“While US online performed largely in line with last year, the improvement in the US Partner business fell short of our expectations,” Ryan said. “However, the 25 per cent growth in City Chic branded products through our websites and partners at materially higher gross margins highlights the opportunity for our brand in the market.
“With an enhanced summer range and broader City Chic assortment in market, we expect this momentum to continue. Realising the full potential of the USA business is now my top priority in the second half of FY25 and into FY26.”