By Kristy Dorsey

Clothing retailer Quiz saw revenues more than double during the six months to September 30 as the removal of restrictions on social gatherings boosted demand for its core occasion wear.

The Glasgow-headquartered chain said its restructured business has returned to generating positive operating cash flows and is “well-placed” to benefit from continued recovery in customer demand. However the emergence of the Omicron variant of Covid, with the potential to disrupt Christmas events, is a “concern” and could have a negative short-term impact.

Tarak Ramzan, founder and chief executive of Quiz, said the interim results were “encouraging”. They come after a year in which the group suffered an underlying loss of £9.6 million as revenues fell by 66 per cent.

“The removal of social restrictions resulted in a substantial uplift in revenues in the period, as customer demand for the brand’s dressy and occasion wear returned,” Mr Ramzan said. “The positive steps taken over the last 18 months with regards to restructuring our business, tight cost control and inventory management have all proved beneficial.

READ MORE: Quiz salvages profit from the demise of Kast as sales plummet

“Whilst there continues to be uncertainty in the short-term we remain confident in the strength of our brand and are highly confident that the clear demand for Quiz’s trademark occasion-wear will support continued profitable growth.”

Group revenues rose by 109% to £36m, generating underlying earnings of £700,000. This compared to an equivalent loss of £3.3m in the same period a year earlier.

The pre-tax loss of £1.3m compared to last year’s profit of £10.6m when the company benefitted from a £16.2m one-off gain from placing its Kast Retail subsidiary into administration.

Kast, which previously operated the group’s stand-alone stores in the UK and Ireland, was put into administration in June 2020 with the immediate closure of 11 stores and 93 job losses. Quiz re-acquired 82 stores from the administrator for £1.3m in a deal that allowed it to shed lease liabilities and negotiate more flexible rental terms.

Despite those efforts, operating costs rose by 22% during the six months to the end of September, driven primarily by increases administration and distribution expenses. This was partially offset by the receipt of £1m of government Covid support grants.

READ MORE: Cost-cuts and online sales help clothing chain grow confidence

Quiz said sales momentum has continued into the second half of the year, with revenues comparable to levels generated prior to the pandemic in 2019.

During the two months to November 30, revenues from the group’s UK stores and concessions rose to £7.3m, up 186% on the same period a year earlier. Online sales were 77% higher at £6.8m, while international sales rose by 50% to £2.1m.

Quiz noted that as of December 7, it had total liquidity headroom of £7.1m including a cash balance of £4.6m and undrawn banking facilities of £2.5m.

The group is currently operating 63 stores in the UK and five in the Republic of Ireland. Following the closure of Debenhams and Outfit, the number of Quiz concessions has fallen to 72 with the majority operating out of New Look stores.

Mr Ramzan inherited his father’s manufacturing business at the age of 18 and opened his first retail store in Glasgow in 1993. The business joined London’s Alternative Investment Market (AIM) in 2017 with the shares priced at 161p, netting around £92m for the family.

The stock closed yesterday’s trading 0.15p lower at 18.25p.