City Chic Collective (CCX) H2 2024 earnings summary

Executive summary

• FY24 EBITDA was approximately 10% ahead of pro forma forecast, driven by margin improvements, cost reductions, and business transformation initiatives including the sale of Avenue and Evans, brand refresh, inventory normalization, and focus on high-value customers.

• FY24 global sales were $131.6 million, down 28.3% year-over-year, reflecting divestment of non-core brands and challenging market conditions, with 481,000 active customers and inventory reduced by 42.8% to $30.7 million.

• Underlying FY24 EBITDA loss was $8.4 million, 9.8% better than forecast, and statutory NPAT from continuing operations was a loss of $38.4 million.

• FY25 targets are revenue of AUD 142–160 million and EBITDA of AUD 11–18 million, with confidence in achieving these on lower unit volumes and higher ASP.

• Cost reduction and business transformation initiatives delivered $8.8 million in FY24 savings, with a further $11.5 million expected in FY25.

Financial highlights

• Underlying EBITDA loss from continuing operations was $8.4 million, a 47.3% improvement year-over-year and 10% better than June's pro forma forecast, driven by margin increase from 56.3% to 57.3%.

• Revenue declined 28.3% year-over-year to $131.6 million, with store performance in Australia as a bright spot; comp stores down 5% in Q4 but up 10% in the first eight weeks of FY25.

• Net cash position of $3.9 million at year-end, with additional $15 million from Avenue sale and $3.1 million from equity raise received post year-end.

• Statutory NPAT loss attributable to shareholders was $93.0 million, including discontinued operations.

• Inventory normalized, reduced by 42.8% to $30.7 million.

Outlook and guidance

• FY25 targets: revenue of AUD 142–160 million and EBITDA of AUD 11–18 million, with expectation for higher ASP and gross margin trends from H2 FY24 to continue.

• Expect second half of FY25 to be stronger than the first, with USA recovering faster than Australia.

• Cost reduction programs to deliver incremental $11.5 million in FY25.

• Store portfolio expected to remain stable in FY25, with no major expansion or contraction planned; long-term goal to grow to around 120 locations in 3–5 years.

• Inventory position allows for a more agile supply chain and normalized buying patterns.