Studio Retail proves resilient during lockdown
Budget retailer Studio Retail Group said on Thursday that the coronavirus crisis hasn't affected it in the way it has some other retailers.
The company sells fashion product, as well as a wide range of general merchandise online and said that it has worked closely with its logistics partners to ensure that deliveries could continue to be made to customers in a safe manner.
The result? “Studio has been able to trade well ahead of the prior year during the lockdown period”. That said, it appears that it's not fashion product that’s selling well at the moment as it's “seeing particularly strong demand for ranges such as toys, games, electricals, fitness and garden”.
And the firm explained that because of the current environment, it’s “taking a prudent and dynamic approach towards stock intake for the summer period, particularly on clothing, in order to de-risk the business in anticipation of a highly competitive marketplace once the lockdown for high-street retailers is eased”.
It also said that the firm saw “a good cash collections performance from its credit portfolio during the important period between Christmas and Easter,” although it anticipates that customers' incomes “will come under sustained pressure in the coming months due to the coronavirus”. It has taken a number of measures to ease payments loads for its customers.
The group's liquidity looks adequate as it says it has cash on the balance sheet of £32 million, headroom that’s “around £5 million better than we would otherwise have expected to see due to a particularly cautious approach to cash outflows in the week following the lockdown announcement”.
At present, while Studio continues to trade, “the group has sufficient liquidity for its near-term requirements without requiring recourse to government funding schemes”.
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