Brand Architekts reports annual sales decline despite second-half turnaround

By

Nigel TAYLOR

Published
Jul 20, 2021

Positivity and optimism were the key words that ran through Brand Architekts’ trading update for the 52 weeks to 30 June on Tuesday.

A fiscal year of “consolidation, transition and putting in place the strategic building blocks to achieve our Project 50 goal”, went to explain some negative numbers for the ‘challenger’ British beauty brand.

Net sales for FY21 slipped 2.5% year-on-year to £15.9 million, as the pandemic impacted footfall for its high-street customers, it said. 

Although sales in the first half declined 10% to £9 million, at least that was flipped in the second half with 10% gain of £6.9 million. 

It said underlying operating profit for the year is expected to be “in line with the prior year”, without giving a figure. 

Also the group’s strong net cash position (£19 million) improved by £1 million versus FY20, “which positions the group well as it looks to further invest in all aspects of the business to drive growth”.

More positives included Brand Architekts making “good progress” on improving productivity, cutting the number of its live brands to 13 from 22, while broadening both its online and offline distribution across its lead brands in the UK and internationally.

Meanwhile, its key skincare brand, Super Facialist, enjoyed 34% growth in the year, underpinned by the launch of its largest ever marketing campaign, including TV across Channel 4's media.

It also said its nascent direct-to-consumer business has grown by 70% to £0.6 million. “We are building a community led marketplace that addresses the needs of our customers, enables cross-sell between brands and reflects the quality of our assets and we remain confident that we can significantly increase DTC sales through this important channel”, it said. 

The marketplace is expected to “soft launch” by the end of H1 and fully roll out in early 2022.

Brand Architekts added: “While the current operating environment remains uncertain, with delays to the easing of restrictions impacting consumer confidence, we remain confident that the foundations we are building will enable us to achieve our medium and long-term goals".  

Chief executive Quentin Higham added: “I am very positive about the future and optimistic to see the growth potential as seven brand relaunches go to market over the next six months and we are confident that our four strategic pillars will help achieve our medium and long-term goals”.