Clothing retailer Specialty Fashion’s sales rose 4.6 per cent in the September quarter but its Rivers brand continues to drag on its performance.
The company, which also owns the Katies and Millers women’s fashion chains, bought Rivers in November 2013.
“The core business is performing well reflecting the positive investments and improvements made over the past number of years,” CEO, Gary Perlstein, told the company’s annual general meeting.
“However, Rivers is still very much in the turnaround stage and although there is light at the end of the tunnel, positive contributions from this brand will be challenging to achieve in the short term.”
Rivers had been affected by aggressive discounting in recent years, and Specialty was working to rebuild the brand, Perlstein said.
He is confident the business, which was bought for $3.9 million, would be profitable in the future.
“We remain confident that the turnaround efforts are on track, despite the current challenges, and that Rivers will make a real and meaningful contribution to the group’s profitability in future years.”
Despite Specialty Fashion’s stronger comparable September quarter sale, Perlstein declined to offer sales guidance for the December quarter.
Specialty’s net profit fell 3.8 per cent in 2013/14 to $12.5 million, due to weaker sales.