City Chic Collective is benefitting from the acquisition of US retailer Avenue as it reports its FY20 results.
During the period, the business grew its global customer base by 72% to 663,000 active customers, thanks to the acquisition of the US plus sized retailer.
This acquisition also spurred on an increase in sales coming from the region, with 42% of City Chic's global sales coming from the northern hemisphere.
Overall, the business reported a 31% increase in sales revenue to $194.5 million.
CEO and MD Phil Ryan said that the acquisition bolstered the business' digital offering.
"Following the acquisition of Avenue in October 2019, our online channels now represent two thirds of our global business.
"In the past 12 months, we have grown our active customer base by 278,000.
"We also expanded out product offering into the everyday fashion category with Avenue and launched the intimates and playwear brand Fox & Royal which was developed from our acquired Hips & Curves brand.
"Our focus is on leveraging our offering across channels and regions as we continue to scale our business globally," he said.
The success of the Avenue acquisition gives the business a blueprint for the potential acquisition of Catherines, the move of which is backed by $111.1 million of equity capital that the business raised in FY20.
"The acquisition of Avenue has been successfully integrated within our operating structures and supply chain, with trading exceeding our expectations," Ryan added.
"The success of this acquisition, which was earnings accretive in FY20, provides a blueprint for the potential purchase of the Catherines brand, which targets value-conscious women, but skews to different US states.
"We will look to implement our lean and customer-centric operating model and leverage our combined US customer base in the world's largest plus size market," he said.
As is the tale of retailers in 2020, the business experienced growth in eCommerce sales in FY20.
Online sales made up 65% of total sales in the year, compared to 44% last year.
City Chic also witnessed a 113.5% growth of its global websites compared to FY19.
The business' US websites (City Chic USA, Avenue and Hips and Curves) contributed sales of $65.2 million compared to $10.7 million last year.
When it comes to comparable sales growth (CSG), City Chic reported that CSG was 0.4% compared to 12.2% in FY19, which jumps to 6.4% when store closures and partial closures are excluded.
However, the store closures can't be ignored when it comes to City Chic's results in Australia and New Zealand.
The collective's ANZ sales fell by 4.8% for the year, with sales growth of 9.9% in 1H followed by a 21.5% fall in 2H, due to store closures.
Trade improved as stores reopened, with the business reporting that sales were down 26% compared to the previous corresponding period (pcp) in June 2020, up from 47% compared to pcp in April 2020.
Ryan added that despite the challenges of this year, the business is still pleased with the results its has been able to deliver.
"I am pleased with the collective's performance during a year in which challenges were thrown at our business, our team and our customers, and the wider global community.
"The drive and commitment of our people has been inspirational and enabled us to deliver another transformational year.
"We have traded profitably through the disruption caused by COVID-19 and achieved excellent top line growth of over 30%," he said.