City Chic shares plummet despite strong start to financial year

Shares in plus-sized fashion retailer City Chic have plummeted despite posting a slight recovery in revenue at the start of the financial year.

The stock, which has fallen 78 per cent in the year to date, plunged to 9.9¢ at the close yesterday after chief executive Phil Ryan revealed overall revenue was down 4.8 per cent on last year, across all markets and channels.

But this was an improvement on the 9.9 per cent decline recorded in the first eight weeks of fiscal 2025.

Addressing the company’s annual general meeting, Mr Ryan said it had completed its business transformation — including a brand refresh, reduced inventory and evolved its product to more versatile lifestyles.

“We have right sized the business for the current demand,” he told shareholders.

“Our focus now is on driving demand, through reacting to customer-led learnings around product, in season, that our more reactive supply chain facilitates.”

Mr Ryan said the 2024 financial year was a period of consolidation for City Chic, with the divestment of its Evans brand in the UK and the Avenue label in the US.

“In the first 20 weeks of FY25 we delivered 11 per cent growth in trading gross margin dollars,” he said.

“We have evolved our product mix and reduced promotions that lead to a 32 per cent uplift in average selling price.”

Like many retailers, City Chic is banking on the key holiday trading periods.

“The next five weeks are the biggest trading period of the year, with Black Friday, Cyber Monday and the Christmas period including the Boxing Day sales. This will materially impact the annual performance,” he said.

Harvey Norman the same day revealed a 1.7 per cent lift in aggregated sales — which encompass retail and wholesale channels — in the four months to the end of October.

Harvey Norman told shareholders ahead of its annual general meeting that sales were negatively affected by depreciation in the Euro, as well as the New Zealand and Singaporean dollar. But this was partly offset by appreciation in the UK pound and the Malaysian ringgit.