Wourth Group — the company that used to be known as Woolovers — has filed its results for the year to the end of March with the figures showing that revenue increased substantially as it made acquisitions.

But that didn’t help it on the profits front as crucial numbers here fell this time.

The company is the ultimate holding business of a group of firms, the main trading subsidies of which are Woolovers, Pure Collection Cashmere, Scotts (2023), and Hotter Shoes.

In this group, Woolovers and Pure Collection Cashmere are both international direct-to-consumer retailers supplying customers with menswear and womenswear via online and mail order channels. 

Scotts is a D2C retailer supplying homewares. And Hotter is the footwear specialist that Wourth acquired for £6.7 million after it ran into trouble with its over-ambitious expansion strategy. That also operates online via mail order, as well as through physical stores.

So what happened during the year in question? Revenue in the period jumped from £49.73 million up to £87.51 million, the 76% increase being driven by the acquisitions of Scotts and Hotter in particular. The company didn’t give any revenue figures for the businesses it owns on a comparable basis.

But it did report that sales in it UK business increased in the latest year from £37.77 million to £77.97 million, although sales in Europe dropped to £1.9 million from £4.7 million. In the rest of the world they edged up to £7.6 million from £7.2 million.

Yet pre-tax profit fell from £2.75 million to £2.14 million. That was despite the gross margin jumping from 39.3% to 49.8% and gross profit increasing by 123.3% to £43.62 million. What caused the profits fall? Admin expenses grew by a big margin (up almost 153% at £32.83 million) when excluding exceptional costs. But that’s understandable given the increased cost base after the aforementioned acquisitions were made.

Profit after tax was also down, falling from £2.155 million in the previous year to £732,000 this time.

A period in which acquisitions happen and are integrated into an existing business can often see profits dented and during this particular year there were a number of non-recurring one-off costs linked to the integration, totalling £1.72 million.

The company remains very focused on making more acquisitions if opportunities arise saying it will be looking out for “like-minded brands, targeting the same demographic, which could further accelerate the growth in the group”.

In fact, in August it signed a legal intent to purchase a clothing retailer for a total price of €11.5 million, although it didn’t say the name of that retailer.