Vivienne Westwood to cut costs as weak pound bites into profits

By

Barbara Santamaria

Published
Nov 20, 2017

British designer Vivienne Westwood said sales for the year to 31 December 2016 increased by 11%, but margins were under pressure due to the challenging conditions in the retail market and the weak pound following Brexit.

During the period, the company saw a 37% increase in wholesale sales and a 5.3% rise in retail sales, lifting its full-year turnover to £37.5 million, compared with turnover of £33.7 million a year earlier.

Vivienne Westwood said the brand “continues to remain attractive to its wider customer base as sales growth demonstrates”. However, the company suffered a dramatic drop in pre-tax profit, sliding to £1.9 million from £2.3 million in 2016.

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It attributed the decline in profitability to a 19% increase in cost of sales due in part to the weak pound following the EU referendum. As a result, it is focussing on alleviating this pressure by reviewing pricing and committing to a policy of cost tightening.

The brand is also undergoing a strategic review of the business aimed at creating a new operating structure. It said this will allow it to optimise processes and the overall efficiency of the business.