Mountain Warehouse, the British outdoor retailer focusing on private labels, has reportedly shelved plans for an initial public offering (IPO) that was projected to value the company at about £200 million (€224.3m-$244.3m), despite record sales for the first half of its fiscal year.
Mark Neale, the group's chief executive, told The Daily Telegraph that he had explored the IPO but had never been fully convinced that it was the right way forward, and concerns around Britain's exit from the European Union made it easier to drop the plans. Another important factor is that Neale teamed up with other managers in November 2013 to regain control from private equity owners, and the retailer is apparently able to finance further expansion without an IPO.
Mountain Warehouse's turnover jumped by 29.5 percent to £76.8 million (€86.1m-$93.8m) for the six months ended Aug. 30, thanks to soaring online sales and international trade. The group said its international sales doubled to make up about 20 percent of its turnover for the period, while online sales surged by 61.4 percent.
Mountain Warehouse's profit slipped by £0.3 million to about £4 million (€4.49m-$4.89m), as it opened 24 shops over the half-year, half of them outside of the U.K. The retailer had 50 foreign stores at the end of the six months, in the republic of Ireland, Germany, Poland and North America. The 24 openings raised the number of stores to 250 at the end of August. Another 12 are planned by the end of the year, eight of them outside of the U.K.
Mountain Warehouse also launched country-specific websites for Australia, Canada, the U.S. and Germany, and other online stores are in the works for Poland and France. Furthermore, the company has four stores for Zakti, an activewear brand launched last year to cater for demand from predominantly urban and female customers. The group is launching a Zakti range for children this month.
Market jitters have been compounded in the last weeks by the abrupt fall of sterling and fears that the country is heading toward a “hard Brexit.” Mountain Warehouse told The Daily Telegraph that it would have to raise prices for the first time in five years.