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Accent Group Banks on Youth Brands as CODB Skyrockets

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By Published On: February 23, 20240 Comments

Accent Group’s astronomical CODB and wholesale slump are a stain on an otherwise successful half for the company.

Accent Group distributes over 30 footwear based retail brands including The Athlete’s Foot, Platypus, UGG, Dr Martens, Merrell, Hoka, and many more. The first half of FY24 saw the business open 72 new stores across Australia and New Zealand, bringing the total to 888 with over 10 million contactable customers.

Overall the Group has reported a growth in sales, and is up 2.7 percent on H1 FY23, at $810.9 million.

The Group reported strong sales results were achieved across Skechers, TAF, Hype DC, HOKA, Stylerunner and Nude Lucy. 

Despite this sales growth, a 45 percent increase in the CODB is negatively impacting retail sales with prices being passed down to the customers. This now places the CODB for the half at over $266.6 million. Accent Group says the increasing CODB is impacted by negative LFL retail sales, lower wholesale sales and cost inflation in occupancy and store team costs. 

Wholesale is down by 25 percent, reflecting soft B2B demand. More challenging retail sales conditions were experienced in Accent’s brands Platypus, Dr Martens, Vans and Glue.

Accent Group CEO, Daniel Agostinelli, said “Retail sales for the key trading period of Black Friday, Christmas and Boxing Day were positive including record Boxing Day sales online and instore. Like-for-like retail sales for this period (Weeks 20-26) were up 1.8 percent. I am delighted with the ongoing performance in Skechers, Hype DC, The Athlete’s Foot (TAF), HOKA, Stylerunner and Nude Lucy. Nude Lucy now has 34 stores trading. Digital sales continue to grow strongly, and online EBIT was ahead of last year. The Group opened 72 new stores in H1 (including 13 new Nude Lucy stores). The Company closed H1 FY24 with inventory levels below last year ($256.6 million vs $267.4 million) and aged stock levels are clean.”

Looking to H2, the Group plans to continue its expansion strategy with 20 new stores planned to open in H2 FY24 and further investment in its more luxurious youth focused brands Nude Lucy and Stylerunner. 

“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,” Mr 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”

Accent Group stated, “The business remains well positioned for future growth through continued expansion in new retail stores, the introduction of new categories including youth and active apparel, continued growth in wholesale, a continuing drive to improve underlying gross margin, and ongoing investments in digital and customer data.”

About the Author: Rosalea Catterson

Rosalea is the Editor of Power Retail. With a keen interest in consumer behaviour and tech, she covers everything ecommerce and hosts the Power Retail Power Talks Podcast.

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