Australian fashion business Country Road Group has reported a net loss after tax (NPAT) for FY26 that is starkly improved on its FY25 bottom line.
In its full-year audited results, Country Road Group parent company Woolworths Holdings Limited, in South Africa, reported that the fashion group behind the likes of Witchery, Country Road and Politix saw a loss of R250 million, or around $21 million AUD, in FY26.
This is down from an R1.43 billion loss in FY25, or a loss of circa A$123.8 million.
The Group’s bottom line improved amid soft total sales growth of just 1 per cent for the financial year to June 28, 2026. This was offset by a 0.5 per cent fall in the second half, with these numbers affected by foreign exchange rates. Country Road Group has a significant market in South Africa as well as Australia and New Zealand.
In South African Rand, Country Road Group’s revenue for FY26 slipped from R12.57 billion to R12.35 billion, which still remains just above $1 billion in AUD – or A$1.07 billion roughly. The group saw better sales growth in South Africa compared to Australasia.
Amid the bottom line bump up, Country Road Group saw a slight lift in its gross profit margin to 57.7 per cent. Historically, this is down on FY23 numbers when it was at 62.6 per cent.
FY23 was the last time Country Road Group reported a profit as well, which was at a high of R850 million or A$73.6 million.
Country Road Group CEO Steven Cook said the result reflected deliberate decisions made throughout the year to strengthen the underlying health of the business and its portfolio of brands.
"At the start of the year, we set out to improve the quality of our sales, strengthen our inventory position and operate more efficiently," Cook said. "While market conditions remained challenging, that discipline improved profitability, reduced inventory and provided the agility to respond to changing customer demand, helping us return the business to profit."
"Our focus has been on building stronger foundations, while ensuring each of our brands has a clear positioning, compelling product offer and the ability to grow sustainably over time. We've made meaningful progress over the past 12 months and enter FY27 with a clear plan and a solid platform to build on."
According to the group, Witchery and Politix continued to benefit from their repositioning strategies. Witchery reported comparable sales growth of 9.5 per cent and BGP growth of 16.5 per cent, while Politix delivered comparable sales growth of 10.2 per cent and BGP growth of 8.7 per cent.
Meanwhile, Country Road reportedly showed "encouraging signs" of improvement through the second half and enters FY27 with new leadership, under Lucy Nutter -- who is MD for Witchery and Country Road.
"We've made meaningful progress over the past year to restore the health of the business," Cook added. "Each of our brands has a clear role to play, and we'll continue investing in product, customer experience and capability to support sustainable growth across the portfolio."
In its official trading update today, Woolworths Holdings Limited reported that the apparel sector in AU/NZ had begun to stabilise in the first half of FY26, but stubborn interest rates and the US-Iran war impeded further recovery.
For Country Road Group, WHL claimed that consumer sentiment, footfall and spend had come under significant pressure as a result.
“The sector remains intensely promotional, as retailers reduce excess inventory levels,” WHL reported.
“The Country Road brand traded marginally ahead of last year, while Witchery and Politix were well up on the prior period, benefiting from the repositioning of their respective brands. There was no material change to the net trading space or online contribution to sales compared to the prior period.”
WHL noted that CRG’s deliberate focus to improve the quality of sales with greater full-price sales and reduced discounting had helped lift H2 gross profit margin year-on-year – “notwithstanding the impact of higher freight costs.”
“The full-year gross profit margin improved by 130bps to 57.7 per cent, an encouraging outcome in the context of an intensely competitive and highly promotional trading environment,” WHL concluded. “This, coupled with the reduced cost of doing business from our reset operating model, resulted in expenses being marginally below last year, and saw CRG pleasingly return to full-year profitability, albeit not to the extent that was initially envisaged pre the onset of the war.”
CRG’s adjusted earnings before interest and tax (EBIT) hit A42.3 million, up by $20.4 million from the prior period, with a positive EBIT margin of 0.3 per cent.