Footwear conglomerate Accent Group has reported a $13.5 million drop in half-year owned sales to $732.89 million. This includes a 25 per cent drop in wholesale sales.
The company manages more than 30 brands across Australia and New Zealand, including Skechers, Hype DC, Dr Martens and Hoka. Of those, 17 are wholesale brands.
The lower wholesale sales has impacted the brand's cost of doing business (CODB), alongside negative like-for-like sales during the half (down 0.6%) and cost inflation in occupancy and store team costs. Additional cost efficiency initiatives have been implemented in non-customer facing areas, including an ongoing review of support office costs.
Accent Group's CODB lifted by $12.8 million to $266.6 million - excluding lease depreciation and interest.
According to Accent Group, Skechers, TAF, Hype DC, Hoka, Stylerunner and Nude Lucy recorded stronger sales results, with more challenging conditions experienced in Platypus, Dr Martens, Vans and Glue.
This news comes as Super Retail Group's sporting subsidiary Rebel reported challenging trade in the footwear category in the first half of FY24. It also comes as the Australian Bureau of Statistics reported a deflation spiral in all fashion categories, with footwear hit the hardest - primarily womenswear footwear.
Looking ahead at Accent Group, total owned sales in the year-to-date to the end of January were up 1.6 per cent, while owned retail sales over this period were up 5.6 per cent reflecting new store openings.
LFL retail sales for the first seven weeks of the second half - to February 18 - are down 0.7 per cent on the prior year, despite being up 1.8% in the last six weeks of 2023.
“Whilst we recognise that there is some uncertainty in the economic outlook, in the context of the consumer environment, we have been pleased with trading and execution in the key periods of November, December and January,” Accent Group CEO Daniel Agostinelli said.
“Looking forward, our store opening program remains on track. Stylerunner performance has been positive and the Nude Lucy brand is resonating well with customers. Continued store rollouts are planned in both banners.”
As of December 31, the brand operated 888 stores across 24 different retail banners, with 70 opened during the first half, and 20 expected to open in the second half.