Very Group Posts Record Earnings Driven by Profit Focus

The Very Group, owner of retail giants Very and Littlewoods, has reported a period of significant earnings growth for the year ending June. This impressive financial upturn was attributed to robust performances across both its retail and financial services divisions, coupled with stringent cost discipline implemented throughout the group. The company's strategic focus on profitability clearly yielded positive results, particularly in a challenging market landscape.

Quantifying this success, the company saw its adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) climb by a substantial 15.9%, reaching £307.1 million. This surge also propelled its adjusted EBITDA margin to an unprecedented 14.7% from the previous year's 12.5%, marking the highest earnings margin ever achieved by the group. While profitability soared, group revenue experienced a slight decline of 1.8% to £2.09 billion, with Very UK revenue remaining broadly stable, seeing a marginal 0.2% dip to £1.83 billion. This decline, the company noted, was a conscious reflection of its strategy to prioritise profitability over sheer volume in a competitive retail environment, with no specific details provided for the legacy Littlewoods operation.

Further bolstering its financial health, the group's gross margin expanded by 1% to 36.6% during the year. This growth was largely a result of a strong performance from its financial services arm and a strategic shift in the retail sales mix, notably an increase in higher-margin Home sales. However, not all retail categories fared equally well; Fashion and Sports experienced a 3.7% decline amidst a heavily discounted and challenging market. This decline occurred despite Very's efforts to expand its brand portfolio with leading names like New Balance, Decathlon, and Sweaty Betty. In contrast, the Beauty category demonstrated strong growth, increasing by 5.2% following significant targeted investment.

Robbie Feather, CEO of The Very Group, remarked on FY25 being "a year of real progress." He emphasised the unique strength of their business model as a multi-category digital retailer and flexible payments provider, which continues to resonate deeply with the families they serve. Feather proudly highlighted the achievement of the company's best-ever customer satisfaction score, underscoring their commitment to customer experience. He attributed their strong performance, despite economic headwinds, to a dedicated focus on enhancing every aspect of their offer, ensuring the availability of the right products at the right time and price, coupled with flexible payment options. This, combined with disciplined cost control, was pivotal in delivering significant earnings growth.

Feather also detailed robust progress against the group's strategic priorities. Key milestones were completed in its technology transformation journey, alongside significant upgrades to its apps and websites. Furthermore, the year saw the successful relaunch of Very’s retail media proposition and the launch of HelloStudio, the group's new in-house creative agency, signalling continued innovation and expansion within the digital retail space.