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Gymshark has revealed that its profits slipped by 38.7% for the year ended 31 July 2022, citing soaring production costs and customers with less disposable income as the reason behind its performance.
The news comes as the Birmingham-based athletic clothing retailer, which opened its first brick-and-mortar store on Regent Street, London, last year, had to cut prices despite the price of raw materials and shipping increasing.
While revenues in the year increased by 21% to £485m due to a 25% jump in turnover in the UK to £228m, sales in the UK only rose by under 3% to £89m.
Ben Francis, director of Gymshark, said: “The wider macroeconomic environment is continuing to have an impact on the consumer and on the company’s business. As a result, the directors anticipate that the previous growth trajectory that the company experienced in different times will not continue in the same way.
“We are continuing to explore ways to innovate the company’s product offering and go to market strategies. The main areas for future development include extensions to the product range and expanding the company’s sales in new territories.”
Gymshark, which was co-founded by Francis in 2012, has since grown to more than 900 employees worldwide. The firm hit a valuation of £1bn in August 2020 after raising £200m in its inaugural funding round.
