PAS Group has report a net profit decline of 44% to $3 million on continuing business for the first half of fiscal 2018.
The group also reported a 3.1% decrease in revenue to $131.4 million and a 27% decrease in EBITDA to $8.4 million.
CEO Eric Morris said the results came as the apparel sector faced cyclical and structural challenges while highlighting PAS' ability to remain debt free and maintain their balance sheet for 2018.
“The retail apparel segment continues to face unprecedented challenges due to both cyclical and structural changes.
“Whilst this has had a direct impact on sales, we will continue to successfully deliver against our strategy with several initiatives underway that will underpin the company's success over the long term.
“Despite the trading environment, PAS remains debt free, has a strong balance sheet and continues to evaluate potential strategic opportunities whilst maintaining a tight focus on cost control.”
The result was driven by a decline in like-for-like retail sales particularly over the first eight weeks of the half year and over the Christmas period coupled.
The group also cited reduced concession sales, lower foot traffic at Myer and a 7.1% decline in wholesales as a key contributor to the results.
Online sales proved to be crucial to the group as online sales grew by 25.5% with online sales now representing 14% of total retail sales.
A key strategic focus for the Group is the continued growth of itsonline business.
In January, Review launched on the Alibaba Tmall platform and is expected to launch on Amazon later this year.
In addition to recent launches of the Australian Everlast website and the online direct active wear collaboration with B.O.D by Rachael Finch, there are further digital initiatives planned in 2018.
These initiatives include a relaunch of Review on a new Tier 1 web platform and further enhancements to existing customer loyalty programs across the Group .
At the back-end, PAS expects a new program commencing in July to deliver $15- 20 million per annum in incremental sales for the next two years. The program is a supply deal for Coles' Mix apparel brand.
PAS also expects to sign another international sports brand, following its recent acquisition of the Londsdale distribution license.