Accent Group reports flat sales for start of 2023-24, weighed down by wholesale of the business

Footwear retail giant Accent’s shares have plunged after the group reported flat sales, weighed down by the wholesale side of the conglomerate.

Footwear retail giant Accent’s shares have plunged after the group reported flat sales, weighed down by the wholesale side of the conglomerate.

With the Christmas season fast approaching, the company, whose brands include the Hype and Platypus shoe chains, said total sales from its owned retail stores were up 2.1 per cent in the first 19 weeks of 2023-24.

However, like-for-like sales – which included The Athlete’s Foot franchises, digital sales and Glue stores – were down 2 per cent as cost of living pressures discouraged shoppers.

“Wholesale sales have been more challenging, reflecting softer demand from other retailers,” Accent CEO Daniel Agostinelli said.

The Brett Blundy-backed company said gross margins were broadly in line to the comparable period last year. However, due to inflationary pressures, the cost of doing business up to the end of week 19 was higher than the prior year.

Accent’s shares closed down 8.3 per cent to $1.935.

Mr Agostinelli said Accent’s new store opening program was on track and he expected to open 70 new stores in the first six months of the financial year, with many of them in November and December.

Accent Group CEO Daniel Agostinelli

“The group’s in-stock position along with sales and operational plans are well set heading into the three most important trading months of the year,” he said.

“For FY24, we will be focusing on continued rollout of new stores, improved underlying gross margin from our ‘moat’ brands (being our distributed and vertically owned brands), growth in Nude Lucy, operational improvement in Glue Store and Stylerunner, profit growth from The Athlete’s Foot and continued growth in digital sales.”

Accent in August reported that total sales in 2022-23 (excluding The Athlete’s Foot franchisees) was $1.39bn, up 26.3 per cent on the prior year, while earnings soared by 123 per cent.

In the last financial year Accent opened 80 new stores, including 20 Platypus stores, 18 Skechers stores and 22 Nude Lucy stores, to increase its total store numbers in Australia and New Zealand to 821.

Mr Agostinelli said digital sales had increased by more than three times in the last four years since the uninterrupted FY19 base year.

“It was expected that online sales would fall back in FY23 off the back of the store disruption experienced in FY22, but having said that, we did see digital sales grow in the second half,” he said.

“In FY23, the mix of online sales at 19.1 per cent has nearly doubled from 10.2 per cent in FY19.”