In FY24, the decline in revenues reflected the impact of lower traffic to the Quiz online site due to reduced consumer demand. Credit: Shutterstock

Quiz reported an 11% decrease in its FY24 group revenue to £82m from £91.7m in 2023, due to what it described as the impacts of cost-of-living pressures on consumer demand.

GlobalData senior apparel analyst Pippa Stephens believes Quiz’s continued blame on cost-of-living pressures for its poor performance since before the pandemic reflects “wider problems” that need solving for it to “regain relevance.”

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Sales in Quiz’s UK standalone stores and concessions decreased 8% to £41.7m attributable to a drop in footfall across the company’s store estate. International revenues were impacted by the increased cost of living impacting demand leading to a 4% fall to £15.8m.

In FY24, the decline in revenues reflected the impact of lower traffic to the Quiz site due to reduced consumer demand. Partially offsetting this decline was an improvement in the average transaction value and conversion rates year on year.

Stephens points out that Quiz has faced huge competition from online pure-plays, primarily Shein, which are able to “undercut Quiz’s prices and react to trends more quickly, making them more desirable among shoppers.

“Quiz is also usually perceived as less fashionable than these rivals, so it must have a strong focus on revamping its designs to draw in consumers,” says Stephens.

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Following a difficult trading period in December 2023, Quiz’s chairman Peter Cowgill initiated a review of its strategic options which resulted in Sheraz Ramzan being appointed CEO.

Quiz now reports that discussions have begun with its founder with regard to the provision of a £1m loan facility to provide additional liquidity headroom for working capital purposes.

Ramzan commented on the results and said: “Whilst these results are disappointing – in part driven by the challenging macroeconomic conditions impacting many retailers – we have a clear plan to improve performance by leveraging our key strengths as an omni-channel retailer with a distinctive brand. We have identified several focus areas to build a more resilient business, improve our performance, and return to profitable growth in the medium term.”

Key results from Quiz FY24:

  • The gross margin in the year increased to 62.2% from 61.6% in 2023,
  • EBITDA of £0.9m from £6.2 m in 2023 with the reduced revenues in the year being the main factor leading to the lower EBITDA,
  • An operating loss of £4.4m was incurred compared to £2.5m in 2023.

Quiz said that in recent weeks it has seen ‘green shoots’ from a number of the initiatives outlined above to improve business performance with an improvement across in-store and online revenues relative to previous months.

The board expect the trading environment in H2 to remain challenging, albeit the group has softer comparatives in the second half of the financial year. 

There remains uncertainty with regard to consumer demand and inflationary cost pressures, but the board are targeting an improvement in financial performance through increasing revenues and continued cost controls.

Despite the macroeconomic challenges, the board remains confident that Quiz’s turnaround strategy led by the new CEO will improve the company’s performance and return the business to profitable growth in the medium term.

The CEO continued: “In the new financial year to date we have already implemented several operational initiatives which I am confident will support our longer-term turnaround strategy. Whilst trading conditions in the current year have remained challenging and our turnaround will take time, I am pleased with the speed at which as a team we have been able to drive positive changes in the business.”