Noni B owner Mosaic Brands planning regional push amid profit return

The owner of chains Katies, Millers, Rivers and Noni B, Mosaic Brands, is back in black and is planning to roll out 40 ‘mega stores’, mostly in regional Australia.

The owner of Noni B, Millers and Katies is targeting regional Australia with plans to open up to 40 “mega stores” after eking out a small profit.

Mosaic Brands has announced significant investment and roll out of a new online platform too, including AI-powered customer analysis, which is expected to be completed within the first quarter of fiscal 2024.

It comes as the owner of a large portfolio of fashion stores, which includes banners such as Rockmans, Crossroads and Rivers, posted a full-year profit of $1.2m against a loss of more than $11m in 2022 that bore the bruises of lockdowns, retail stores closed and a pullback in consumer confidence.

Mosaic booked earnings of $17.1m from a loss of $16.4m in 2022. However, its dividend remained suspended.

“This $33m turnaround is not simply a result of customers returning to in-store shopping post the pandemic,” said Mosaic Brands chief executive Scott Evans.

“It is a recognition by the group that retail has forever changed, customer expectations have shifted dramatically, and that resuming our consistent pre-Covid profitability required taking a leap forward rather than taking a step back.”

Mr Evans cited the growth of online, which now contributes one fifth of group revenue and saw 4.4 million items shopped in fiscal 2023, and the shift towards big box retailing and away from higher-rent, smaller-format stores as key elements of the turnaround.

Annual sales rose 6 per cent, with like for like sales up 9.6 per cent.

To now reposition to meet changing consumer needs, Mosaic Brands said 40 new mega stores, which it has tagged its ‘BIG Strategy’, and which will be typically three times more profitable than mall or standard size stores, are planned to be rolled out in fiscal 2024 – the majority located in regional Australia.

“Mosaic Brands has survived the pandemic-induced downturn and emerged as a more value driven, operationally-lean, and strategically-focused organisation that has a clear vision as to where future growth opportunities in the retail landscape sit,” Mr Evans said.

“Our BIG Strategy sees Mosaic Brands maintain and expand our core customer base, as seen in the Rivers brand, while drawing in an increasingly value-conscious cross-section of the community,” said Mr Evans

Turning to the outlook, customer sentiment and confidence remained volatile, with June and July seeing a slowdown as a result of the most recent interest rises, the retailer said. However, August had seen a strong bounce back, with the group’s in-store sales up 10 per cent against the same period last year.

Originally published as Noni B owner Mosaic Brands planning regional push amid profit return