Investing.com -- TheWorks.co.uk, a UK-based retailer of crafts and books, reported a reduced pretax loss for the first half of its fiscal year, despite a decrease in online sales. The company also cautioned about potential additional expenses due to imminent increases in the minimum wage and employer taxes in the UK.
TheWorks.co.uk, which sells a variety of products including arts, crafts, toys, books, and stationery, reaffirmed its 2025 guidance of pre-IFRS16 adjusted earnings before interest, taxes, depreciation, and amortization of 8.5 million pounds.
However, it also warned of significant cost pressures, including an anticipated additional 6.5 million pounds in fiscal 2026.
TheWorks.co.uk reported a pretax loss of 6.9 million pounds ($8.5 million) for the six months that ended on Nov. 3. This figure is a reduction from the loss of 16.5 million pounds recorded during the same period in the previous year. The company also saw a slight revenue growth of 1.3%, reaching 122.6 million pounds.
The company's online sales experienced a 15% drop, which the London-listed group attributed to a deliberate decrease in promotions and limited capacity at its outsourced online fulfillment center.
Store sales, which constitute the majority of the company's total sales, saw a modest increase of 0.9%. This growth was due, in part, to stronger fiction book sales.
Gavin Peck, the Chief Executive of TheWorks.co.uk, commented on the company's performance during the holiday season. "We faced persistently difficult market conditions this Christmas but did not let this dampen our enthusiasm, instead focusing on the factors within our control," Peck said. "We delivered a resilient store performance and saw strong customer demand for our festive ranges."
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