Thursday 14 December 2017

Primark rival New Look is 'ready to step out on stock market' says boss

New Look said it had seen a positive shopper response to new ranges in 2015.
New Look said it had seen a positive shopper response to new ranges in 2015.
John Mulligan

John Mulligan

UK fashion chain New Look is ready for a stock market flotation, but a final decision is up to private equity owners, according to chief executive Anders Kristiansen.

It would mark the second attempt at a flotation for the chain, which competes with Dublin-headquartered Primark, as well as rivals such as H&M.

Mr Kristiansen said that the company has "demonstrated that in tough periods we continue to perform well," adding that he thinks the company is ready for markets.

New Look is owned by private equity groups Apax and Permira, as well as its founder, Tom Singh. They took the firm private in 2004.

A planned flotation in 2010 was pulled because of the state of global financial markets at the time.

The chain has about nine stores in Ireland and 569 in the UK. It has a total of over 800 outlets in 21 countries. It is the UK's second-biggest women's fashion chain.

The chain does not publish separate accounts for its business in Ireland.

Not all analysts share the chief executive's view that the retailer is ready for an initial public offer.

"It's still too early to try a float and they must continue to work on rebuilding the track record," said Nick Bubb, an independent retail analyst in London.

New Look's third-quarter revenue fell 1.6pc to £400m (€539m), with the company citing the unseasonably warm fall weather that also weighed on sales at H&M and Next.

New Look said it had seen a positive shopper response to new ranges in 2015. Sales at stores open more than a year fell 1.7pc in the 13 weeks to December 27 compared with the year before.

"The return of more seasonal weather in January has supported the planned clearance of winter lines as we resume full-price trading," said Mr Kristiansen.

"Whilst we remain watchful of the wider consumer environment, we remain confident in the strength of the New Look brand and we have seen a promising early response to our new ranges," added the chief executive.

New Look will expand in China after exiting Russia due to political turmoil, Mr Kristiansen said.

It plans to have 70 Chinese stores by the end of the next financial year, he said, making China New Look's second-biggest market by store numbers.

Primark, which is owned by Associated British Foods, has been enormously successful in appealing to shoppers across Europe. The chain will open its first outlets in the United States at the end of this year.

Last year, there were fresh rumours that ABF might be getting ready to spin off Primark with its own stock market listing. But management quashed that speculation.

(Additonal reporting by Reuters and Bloomberg)

Irish Independent

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