Top Secret sales hit by effect of trade ban
In the first ten days of March, Top Secret sales were comparable to that recorded in the same period a year before. However, revenue cratered on the imposed ban on trade. On the other hand, higher share of products from the new spring collection and lower markdowns on items from previous seasons improved the generated margin slightly.
Sales of Top Secret products in March 2020 totalled approximately PLN 7.6m, having dropped some 59% year on year. Top Secret’s cumulative year-to-date revenue was approximately PLN 33m, down some 38% relative to the corresponding period of the previous year.
“Sales in Top Secret stores in Poland, which is the key distribution channel, stood at PLN 4.5m and were 63% lower relative to the same period a year before, with the network area reduced by 3% year on year. While until 10 March we posted comparable sales in year-on-year terms, the imposed restrictions on the operation of stores in shopping centres and mounting uncertainty among customers virtually wiped out all sales even in those stores, to which the trade ban did not apply directly. On the positive note, we posted an increased gross margin due to a 4pp higher share of current collections in revenue and lower markdowns on previous season items”, said Bogusz Kruszyński, the President of the Redan Management Board.
Revenue from the sale of merchandise through the Top Secret online store in Poland totalled PLN 1.8m in March 2020, down 51% over March 2019. Cumulatively, revenue generated by the Top Secret online store in Poland stood at PLN 5.4m and was lower by approximately 42% year on year. “Online sales also suffered due to the situation in the country, which caused a significant drop in the number of visits and sales in this channel, in particular in the first days of the restrictions. Sales improved slightly year on year at the end of March,” added Bogusz Kruszyński.
As at the end of March 2020, the retail space of chain stores selling Top Secret, Troll and DryWash brand products was 30.8 thousand m2, down 16% compared to the end of March 2019. 70% of the reduction stemmed from store closure or loss of control of stores located abroad. The reduced stock from previous seasons also caused the outlet chain to shrink.
Following the loss of control over TXM S.A. w restrukturyzacji (subject to restructuring), as of 18 July 2019 its revenue data is not published by the Redan Group.