The Works upgrades profit outlook as turnaround takes effect
The Works said it expects to deliver an adjusted EBITDA of £9.5m for the year to 4 May, beating its previous forecast of £8.5m, as the business makes progress against its turnaround plan.
The Works said it expects to deliver an adjusted EBITDA of £9.5m for the year to 4 May, beating its previous forecast of £8.5m, as the business makes progress against its turnaround plan.
The retailer has also increased its guidance for the current financial year and is targeting profit growth in excess of the £10m adjusted EBITDA it originally stated.
The revised outlook comes as The Works reported it had made “excellent initial progress” against its new strategy, which focuses on improving brand image, customer convenience and efficiency across the business.
It said that it sustained product margin growth during the year and the cost-savings it delivered which more than offset cost headwinds contributed to a “significant improvement in profit”.
Total revenue for the retailer slipped 2% to £277m in the period, which it attributed partly to trading out of eight fewer stores and an additional trading week last year.
On a like-for-like basis, sales remained flat at 0.8%. The 2.3% growth in store sales, which represent over 90% of the revenue, helped to offset the 12.1% decline in online.
Trading picked up in the fourth quarter, with like-for-likes up 6.4% driven by a 6.9% increase in stores and online improving to flat sales.
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The Works chief executive Gavin Peck said: “We are pleased to have made such significant progress in FY25, both strategically and financially, particularly given the challenging retail backdrop.
“Our sustained efforts to reduce costs and grow product margins, together with the strong sales growth post-Christmas, means we delivered profits ahead of expectations in FY25.
“Execution of our new strategy, ‘Elevating The Works’, is already delivering tangible results.
“As ever, we’ve got more work to do, but everyone at The Works is focused on fulfilling our ambition to become the favourite destination for affordable, screen-free activities for the whole family.
“We are confident that this, coupled with the strong momentum in our trading performance, will see us deliver further profit growth in FY26.”
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