Relaunched Biba helps boost sales for House of Fraser

The group, which has 61 stores in the UK and Ireland, is focusing on more profitable in-house brands, which currently represent just 11 per cent of sales.

Biba has taken the market by storm and, just two weeks after its launch, its sales are outstripping the group's other in-house brands.

House of Fraser said it is well placed to achieve its 30 to 40 per cent target for house brand sales, helped by the success of other in-house ranges such as Dickins & Jones, Casa Couture and Label Lab.

The department store chain, which has stores in Doncaster, Grimsby, Huddersfield, Hull, Leeds, Sheffield and Skipton, said like-for-like sales rose 8.4 per cent in the 26 weeks to July 31, rising to a 10 per cent increase in the first seven weeks of the second half of the year helped by the launch of Biba.

Biba is available at the group's Leeds, Hull and Sheffield stores and the best selling item in the region is the Lily dress modelled by Daisy Lowe (see page 1).

House of Fraser's strategy is to develop its own lines, such as Linea and Episode, while also buying or holding the licence to sell established brand names.

The company posted a 22 per cent rise in first-half core earnings.

The privately-owned group said it made earnings before interest, tax, depreciation and amortisation (EBITDA) of 13m in the 26 weeks to July 31 on a 5.5 per cent rise in sales to 480.6m.

The first-half performance was boosted by a 62 per cent rise in sales of the group's house brands and a 150 per cent increase in online sales.

Debt was down 10.1m on the same time last year.

House of Fraser, which dates back to 1849 when it was a drapery business, was bought by a consortium led by the now defunct Icelandic retail investor Baugur in a 351m deal in November 2006.

The group was part of an extensive portfolio of British businesses backed by Baugur before it collapsed, with Baugur's 33 per cent stake reverting to fellow Icelandic bank Landsbanki.

The group is also developing its website business, and hopes for sales of 200m within three years.

E-commerce sales over the last 12 months amounted to 35m.

House of Fraser said it planned to expand the products available online, and this month will introduce a feature that gives customers the option to buy online and collect in store.

It is also refurbishing stores and working on plans to open its first outlet in the Middle East under a partnership with Retail Arabia International. The first store is due to open in Abu Dhabi in 2012.

Other retail groups have also refocused on in-house ranges rather than concessions to shore up results amid tougher times for retailers.

Debenhams, in particular, has made the move to concentrate on its exclusive ranges such as Designers at Debenhams.

House of Fraser secured an overhaul of its lending terms earlier this year in a move allowing it to ramp-up expansion and buy more stock.