Studio Retail, whose biggest shareholder is Mike Ashley's Frasers Group, has described its recent trading performance as “exceptional” after sales surged during the lockdown.
Online demand for its toys, homewares and gifts meant product revenues were up 42% in the 20 weeks since the end of March. Having passed the milestone of two million active customers in June, Studio said it was now well placed for the Christmas period.
Shares rose 6% to 265p today, boosting the value of the 37% stake held by Frasers Group.
The Sports Direct owner made a failed bid worth £140 million for the company in April 2019. Studio is now valued at more than £210 million, having benefited from strong online trading and recent plans to sell its Findel educational resources business for £50 million.
That deal with YPO, which is owned by 13 local education authorities, is still subject to approval from the Competition & Markets Authority (CMA). The parties wrote to the CMA this month arguing that they operated a fragmented market place, with competition as diverse as Amazon and large specialist players such as Lyreco.
The disposal will leave Studio to focus on its retail operation, which today posted operating profits of £39 million for the year to the end of March. Product revenues of £311.7 million were 2.5% higher than a year ago.
Departing chief executive Phil Maudsley, who has seen Studio grow from a small Christmas catalogue operation during 30 years with the company, expects that sales growth for the remainder of this year will moderate to nearer the levels seen in recent years.
He added: “It is now up to us to keep up the momentum and make sure our proposition continues to resonate at a time when shopping habits are moving online and consumers are valuing the pound in their pocket more than ever before.”
