Office and Offspring sales jump despite tough backdrop

Truworths UK Holdco 1 filed its accounts this week and while that name might not strike a chord with many people, the Office/Offspring footwear business for which it’s the holding company probably will.

The accounts cover the year to the end of June 2025 and showed that it generated sales of £321.3 million in the 52-week period, up from £294.3 million the year before. The company said its successful store modernisation and expansion programme was a key driver in it sales growth.

Office and Offspring comprise a total of 76 stores and 11 concessions across the UK and Republic of Ireland (it has concessions within Selfridges and Brown Thomas), combined with an e-commerce channel that accounted for 44.9% of total retail sales during the year. This was down from 46.2% the year before although the fact that the company operated one more physical store than the prior year could have accounted for this.

The company talked of a “strong performance of the business through increase sales, improved margins and ongoing cost containment measures”.

That all helped the gross margin increased to 47.1% from 47% although EBITDA dropped quite sharply. In the previous year, profitability was “materially influenced by the reversal of previously recognised impairments relating to trademarks, right-of-use assets and fixed assets”. These reversals total £49.1 million before tax or £36.8 million after tax and increased total comprehensive income for that year.

So this time, EBITDA dropped to £76.4 million from £117.5 million in the previous year. Profit before tax fell to a whisker short of £60 million from £102 million and net profit dropped to £45.27 million from £79.86 million.

But without the one-off impact that benefited the 2023/24 period, the company clearly prospered in a UK retail environment scarred by high living costs that continue to place pressure on household income and discretionary spending in the category in which the business operates particularly affected.

It expects more of the same going forward on the back of higher inflation, a weak labour market and muted consumer confidence. It also expects the impact of rising labour costs, higher business taxes and continued economic uncertainty to have an impact.

But it appears to be confident in its own business talking of the unique positioning of the Office brand that appeals to both customers and brand partners. The accounts noted that the improved quality of its stores in recent years has enhanced its appeal to major footwear brands, “leading to increase product allocation from key global suppliers”.