​Online fashion group N Brown‘s trading update for the 18 weeks ended 6 January has highlighted “an improving product revenue trend” that was visible throughout last year and continued in Q3.

The company is expecting to meet its adjusted EBITDA guidance for FY24 and is making ongoing investment in its “transformational priorities with further progress expected” in 2024.

That all sounds very good, but there were a lot of negative figures in the report. For instance, Q3 product revenue was down 9.7% at £150.2 million although this was a slight improvement on the year as a whole with year-to-date product revenue down a wider 10.6% at £337.7 million.

The quarterly figure divided into a 7.9% drop at its Strategic brands (JD Williams, Simply Be and Jacamo) to £111.4 million and a 14.7% drop at its Heritage brands to £38.8 million. With the financial services operation also taken into account, overall group revenue fell 9.3% to £226 million.

As mentioned, the company said the “improving product revenue trend reported in the group’s interim results on 12 October continued in Q3”. This was clear from the fact that while the latest quarter saw that 9.7% fall, the drop in Q1 had been 11.9% and in Q2 it had been 10.4%.

So a narrower drop in a quarter that was widely acknowledged by many to be the worst of the year is an achievement, albeit one that doesn’t exactly represent fantastic news as any drop in revenue that’s close to double digits can’t really be celebrated.

But looking on the plus side, the company said the smaller decline in the latest quarter “reflects an improvement in both our Clothing & Footwear and Home businesses. Strong performance was seen in categories including third-party branded womenswear and lingerie, beauty, gaming consoles and our premium own-brand, Anthology”.

Average item values continued to be higher, “driven by pricing discipline and the product mix, while volumes, as expected, reflect the continuation of lower consumer confidence and measured choices which we have taken around margin, including the level of marketing investment”.

Within partnerships, the launch of Simply Be on Sainsbury’s online clothing platform and selected stores is “performing strongly in its first year, as well as providing enhanced exposure to different customer segments”.

The company is continuing to invest in its “transformational priorities, building on progress over the last 12 months”. Following the “successful” launch of the new Jacamo website, customers are getting faster site speeds, and that seems to be bearing fruit as the sales conversion rate has increased by around 20%, despite lower promotional activity.

Further such developments are planned for this year, including the rollout of the new JD Williams website and the addition of new tech such as its Product Information Management (PIM) system, “enhancing product descriptions for customers to inform their purchases and which we expect will also lead to reduced returns”.

The firm’s Net Promoter Score (NPS) for Q3 of 64 was 11pts ahead of last year and included benefits from better delivery performance as well as customer experience improvements.

N Brown also saids that its “proactive moderation of stock intake and clearance of older items reported in the interim results allowed the business to enter peak trading with a cleaner stock position”. Stock at 6 January 2024 was around £26 million lower year-on-year.

And talking of 2024, the firm said it has managed to keep its expectations for FY24 Adjusted EBITDA unchanged because, while slightly softer revenues are expected, they should be offset by further margin discipline.

All in all, the company is undeniably making progress, although it’s obvious that its turnaround isn’t going to happen overnight.