The Very Group sees FY25 record earnings despite fashion sales drop

Overall Performance - The Very Group reported a group revenue decline of 1.8% year-on-year to £2.087.4bn ($2.78bn) for FY25, down from £2.125.3bn in FY24, indicating a focus on profitability over volume in a challenging market [1] - Adjusted EBITDA increased by 15.9% to £307.1m compared to £264.9m in FY24, achieving an adjusted EBITDA margin of 14.7%, the highest in the company's history [2] - Group operating profit before exceptional items rose to £246.2m from £218.5m in FY24, while the group loss before tax increased significantly to £505.4m from £16.3m in FY24 [2] Cost Management - Group gross margin improved by 1.0% to 36.6%, attributed to strong financial services performance and a shift in retail sales mix towards higher margin home sales [3] - Operating costs, excluding fair value adjustments, decreased by £36.4m year-on-year, representing a 0.9% reduction as a percentage of revenue to 22.3%, the lowest in the Group's history [3] Category Performance - The fashion and sports segment experienced a decline of 3.7% due to a heavily discounted and challenging market, continuing a trend from FY24 where declines of 5.5% and 0.7% were noted [4] - The home category saw significant growth of 9.9% year-on-year, driven by strong demand for home accessories, textiles, and bedroom furniture, alongside growth in toys (up 4.3%) and beauty (up 5.2%) following targeted investments [5] Strategic Outlook - The CEO of The Very Group described FY25 as a year of real progress, emphasizing the unique business model as a multicategory digital retailer and flexible payments provider that resonates with families [6]