Oak Furnitureland slumped to a loss of almost £32m during its latest financial year, newly-filed documents have revealed.
The Swindon-headquartered company has posted a pre-tax loss of £31.9m for the 12 months to June 30, 2023, after having recorded a profit of £484,000 in the prior year.
That pre-tax profit figure came after Oak Furnitureland made a loss of almost £23m in the year before.
The newly-filed documents with Companies House also show the brand’s turnover increased over the year from £275.2m to £283.7m.
Oak Furnitureland said its results were impacted by an increase in costs, particularly those around shipping goods from Asia, as well as attempting to keep its prices low.
‘The group is in a strong position’
A statement signed off by the board said: “The group is pleased to have delivered turnover of £283.7m, up 3 per cent on the prior year, which was driven by further development of product ranges and strong performance across the showroom estate.
“Profit margins however were lower than the previous year due to a combination of cost increases, particularly the costs associated with shipping goods from Asia in the early part of the financial year, along with the group’s strategy of continuing to offer great value for customers in an environment where discretionary spending is under pressure.
“To mitigate the impact of this the group continued to focus on driving operational efficiencies and cost control.
“Shipping costs started to ease from the second quarter of the year and have shown a steady decline throughout the financial year, ending the year at levels much closer to historical norms.
“This underlined a return to positive operating profit in the second half of the year, with the group delivering £7.4m (H1: £22.8m loss).
“The group is in a strong position to continue this trend into the next financial year.”
During the year the average number of people employed by Oak Furnitureland increased from 1,137 to 1,167.
‘Whole-home’ offer
On its future, Oak Furnitureland added: “It is anticipated that the consumer environment will continue to be challenging in the year ahead.
“Despite this, the group’s focus on continuing to broaden its product proposition to support the on-going development of a ‘whole-home’ offer, investing in the store base and the acceleration of digital innovation will further enhance the shopping experience for its customers and is expected to drive future business growth.”
The results come after Oak Furnitureland was saved from the edge of administration in June 2020 when it was acquired by hedge fund Davidson Kempner Capital Management, saving 1,491 jobs.
According to administrators Deloitte, the retailer had been had been struggling with “adverse trading conditions” caused by the Covid-19 pandemic.
A month later, Oak Furnitureland announced plans to permanently close 27 showrooms, putting 163 employees at risk of redundancy.