A fall in sales outside the UK and USA slowed PrettyLittleThing's growth during its latest financial year as return rates rose, new figures revealed.
The Manchester-headquartered brand, which is part of the wider Boohoo group, has posted a revenue of £712.2m for the 12 months to February 28, 2022, up from the £710.1m it achieved in the prior year.
However, the company's pre-tax profits fell from £98.7m to £75.1m over the same period.
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PrettyLittleThing said its pre-tax profits were impacted by £11.6m of costs related to the automation of its Sheffield warehouse, a £125m project.
The company was established in 2012 by brothers Umar and Adam Kamani. It was bought by Boohoo, which had been co-founded by their father Mahmud Kamani, in January 2017.
Boohoo is listed on the London Stock Exchange and reported its group results for the same financial year in May. It also posted its results for the following six months in September.
However it does not break down the financial results of its individual brands. The figures for PrettyLittleThing's latest financial year have only just been published on Companies House.
A statement signed off by the board said: "The company has achieved a good performance with revenues increasing in the UK and USA while revenues have declined in rest of Europe and rest of world.
"Revenues in the UK and USA have remained resilient despite the easing of lockdown restrictions in the second half of the financial year, and despite returns rates in the second half of the year returning to pre-Covid-19 levels.
"Consumer demand in Europe and rest of world has remained subdued as lockdown restrictions eased and we saw returns rates continue to increase."
Sales in the UK increased by 6.4% during the year and 0.1% in the USA but dropped by 13.8% in the rest of Europe and 21.3% in the rest of the world.
During the year the average number of staff employed by the brand increased from 409 to 455 while its headcount totalled 464 at the end of February.
PrettyLittleThing added: "The market for online fashion is forecast to continue to grow in the medium term.
"The current economic climate of high inflation and cost pressures on consumers may impact demand in the short term.
"Customers throughout the world are expected to continue to seek quality product that represent value for money.
"The company's business model allows it to react quickly to changes in consumer demand and the business continues to focus on offering customers the latest fashion trends at market leading prices, developing its product offering with a greater focus on value proposition to maximise its share of what is likely to be overall reduced consumer spending."
It also said: "We have built a brand and infrastructure to capitalise upon this opportunity and we will continue to grow our market share globally by focusing on key markets.
"The Covid-19 pandemic saw a shift in consumer behaviour with more customers shopping online as a result of the closure of high street retail locations.
"It is expected that this shift in consumer behaviour may continue in the coming years.
"As lockdown restrictions have eased we have continued to see good levels of demand with a shift in consumer demand back into more going out fashion, compared with more casual products purchased during lockdown.
"While demand has remained strong we have also seen an increase in returns levels back to pre-pandemic levels.
"Our strategy will be to use a combination of marketing to drive new customer acquisition and promotions to secure sales, all the while supported by the most convenient delivery and return options and high level of customer service.
"We will continue to broaden the range of products and to refine the online shopping experience with the latest technologies to ensure we provide the most user-friendly website possible.
"The current economic climate of high inflation and cost pressures on consumers creates potential challenges for all retailers.
"The business takes continued actions to ensure we have the most relevant product offering for our customers with a focus on value and quality which should allow the business to be a go-to destination for consumers even at a time where their spending power has been compromised by current economic conditions."
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