In The Style issues profit warning despite 45% rise in revenues
Womenswear brand In The Style has announced strong sales growth for the period April to August 2021, but warned that its profitability will be hit by high shipping costs and increased returns from customers, amid disruptions to UK supply chains.
Group revenue for the period rose 45% year on year, with e-commerce gross order value almost 50% ahead.
The rise is revenues can be attributed In The Style's increasing consumer profile and awareness of its differentiated brand, the continued expansion of the group's influencer collaboration model including the launch of nine new partnerships during the period, and increased customer demand reflecting the return of social events.
The group's primary operational KPIs of website traffic, customer conversion, average order value, and order frequency all showed strong improvements against the prior year.
In The Style's app also continued to deliver strong levels of consumer engagement, with app sales increasing to 62% of total e-commerce sales compared to 53% for the same period in the prior year.
The group's new strategic wholesale partnerships, including the launch in 100 ASDA stores in May 2021, resulted in wholesale sales significantly increasing by in excess of 200% year on year.
Whilst the group reported it has sought to utilise the most efficient channels to ship product and minimise freight and supply chain disruption, increased costs and disruption to the timing of shipments are expected to remain for at least the remainder of the current financial year, impacting profitability.
Shares in the company dipped more than 10% after the profit warning, despite In The Style revealing the spike in sales and impressive consumer engagement data.
Adam Frisby, CEO and Founder of In The Style, commented: "We are pleased with the strong sales momentum achieved during the financial year to date. This momentum has been supported by increasing consumer awareness of In The Style and our clear brand mission to empower customers to be brave, embrace body confidence and, most of all, love themselves for who they are.
"Central to our growth is our differentiated influencer collaboration model that creates strong customer connections, drives efficient customer acquisition, and gives us exposure to a broad range of customers. During the Period we continued to add exciting new influencer partnerships as well as launching a number of successful collections.
"We continue to invest in our team and infrastructure to support our long-term growth, and despite the widely-publicised external headwinds expected to continue to impact across the retail industry over the coming months, we remain very well positioned to continue to grow In The Style and achieve the brand's exciting potential."