Australian-born lingerie brand Honey Birdette has recorded a US$2.5 million (A$3.8 million) lift in sales for the fourth quarter of 2023 to $20.4 million ($31.27 million).
This is a stark turnaround for the brand which had recorded double-digit quarterly losses throughout 2023, resulting in a full-year sales drop of $10.7 million (A$16.4 million), or 13 per cent year-over-year, to $72.9 million (A$111.7 million).
PLBY Group, which owns Honey Birdette alongside the global licensing brand Playboy, listed several rightsizing initiatives over the last year that helped return the business to sales growth.
This included the re-appointing of Kim Kidd as CEO in May 2023. Kidd formerly led the brand between 2019 and 2022, and was with the company when it was sold to PLBY Group in 2021 for $333 million.
Honey Birdette also reduced the number of sale days by 34 per cent year-over-year, replaced its North American third-party logistics and global freight forwarder, and identified four stores with negative 4-wall cash flow contributions for closure - one of which was closed in 2023.
Regarding the store closures, PLBY Group CFO and COO Marc Crossman confirmed these stores are primarily in Australia.
“A lot of the stores in Australia have been around for quite some time,” Crossman said. “And so we're looking at end-of-life leases versus the amount of capex we'd have to put in to refurbish them, and also whether or not they're running at 4-wall loss or profitability.”
The lingerie retailer operates 46 stores across Australia, 12 stores in the United States and three stores in the United Kingdom.
Kohn said Honey Birdette’s key goals for 2024 are to increase its average selling price and gross product margin by further reducing the number of days on sale, to increase product pricing by 10 per cent, and to focus on selling higher margin items at higher price points.
“We also plan to introduce a Honey Birdette loyalty program to create a better customer journey across our brick-and-mortar and online channels,” Kohn said.
“For our brick-and-mortar channel, we are also focusing on investing in our employees through extensive training on our products and operations. And for our online channel, we will focus on organic advertising and marketing.
“In doing so, we seek to increase our visibility in organic search by driving more of our core keywords into the top three Google search results, pursue aggressive social media outreach for product placement with creators and influencers, and leverage our new customer relationship management for enhanced customer segmentation in both email and SMS marketing.”
This comes less than three months since Kohn said PLBY Group is preparing to sell off Honey Birdette.
“Long-term, Honey Birdette doesn’t belong as part of this company, and at the right time, we will sell it,” Kohn had said at a business conference in January. “But right now, the business is performing very well.
“We talked about that in our Q3 results - the month of October - we’ve seen those trends continue, and we’ve also made other operational improvements. But we’re focused on Playboy and really returning that to the experiential lifestyle brand that it was.”
These comments follow a consolidation of assets by PLBY Group in 2023, including selling off two of its other subsidiaries - sexual wellness brand Lovers and another lingerie brand Yandy.
Until the commencement of a sale, Kohn said he and the team are re-evaluating opening new stores in 2024 given Honey Birdette’s performance.
“Honey Birdette had a tough first half of the year, but the improvements we’ve made are there,” he said. “We’re seeing the results from it. And at the right time, we will sell a part or all of that asset.”