Shares in TheWorks.co.uk fell as the company announced a widened pretax loss for the first half of its fiscal year.
Shares Drop by 11% At 0830 GMT, shares were down 2.90 pence, or 11%, reaching 24.10 pence.
Loss Doubles, but Revenue Increases The UK retailer revealed that its pretax loss for the 26 weeks ended October 29 was £14.8 million, compared to a loss of £7.3 million the previous year. However, revenue saw a rise from £118.9 million to £122.6 million.
Focus on Cost-Reduction and Margin Growth TheWorks.co.uk acknowledged the increased pressure on profitability due to lower sales and margins. As a result, the company has shifted its focus to resetting its cost base, growing its gross margin, and scaling back on nonessential investments and expenditures in the short term. While the actions taken have begun to yield positive results, the majority of cost savings are expected to materialize in the next financial year.
Potential Challenges Ahead The company remains cautious about the uncertain outlook for consumer spending and external factors such as stock delays and increased freight costs arising from supply chain disruption in the Red Sea.