Universal Store Holdings (ASX:UNI) posted a 12.9% revenue increase to $376.1 million in FY26, driven by strong like-for-like sales and store expansion. Underlying EBIT climbed 17.2% despite a $23.8 million impairment on CTC assets, while net profit after tax fell 21.6%. CEO Alice Barbery will retire in October, succeeded by George Do.
- Revenue up 12.9% to $376.1 million
- Underlying EBIT rises 17.2% to $64.0 million
- Statutory EBIT hit by $23.8 million CTC impairment
- Net profit after tax down 21.6% to $18.2 million
- CEO Alice Barbery retiring, George Do named successor
Strong Sales and Expansion Drive Growth
Universal Store Holdings Limited (ASX:UNI) delivered a robust FY26 result, with revenue climbing 12.9% to $376.1 million, buoyed by solid like-for-like (LFL) sales growth and the opening of 13 new stores. The group ended the year operating 123 stores across its three retail formats: 88 Universal Store outlets, 26 Perfect Stranger boutiques, and nine THRILLS locations.
Online sales contributed $49.2 million, representing 13.1% of total revenue and rising 10.8% on the prior year, reflecting the company’s ongoing omnichannel strategy. Universal Store and Perfect Stranger posted LFL growth of 8.1% and 13.0% respectively, underscoring the strength of their customer engagement and product curation. The THRILLS retail format also grew LFL sales by 4.2%, with one new store opened during the year.
Underlying Profit Up Despite Impairment Hit
Underlying EBIT rose 17.2% to $64.0 million, reflecting operational leverage from sales growth and improved gross margins, which expanded 140 basis points to 62.5%. This margin gain was driven by category mix, strong private label and third-party assortments, and disciplined pricing strategies.
However, statutory EBIT declined 6.7% to $40.1 million due to a $23.8 million non-cash impairment charge related to the CTC segment’s goodwill and THRILLS brand name. The impairment reflects ongoing challenges in the CTC wholesale channel, which saw sales fall $5.5 million to $23.7 million due to reduced US exports and closure of key retail accounts. Management remains focused on growing CTC’s retail footprint, which showed promising LFL growth and new store openings.
Net profit after tax fell 21.6% to $18.2 million, impacted by the impairment, although underlying net profit after tax increased 16.3% to $40.5 million. Basic earnings per share dropped to 23.8 cents from 30.4 cents, while underlying EPS rose to 52.8 cents from 45.4 cents.
Robust Balance Sheet and Capital Management
The group finished FY26 with a strong cash position of $23.3 million and no bank borrowings, supported by disciplined working capital management and operating cash flow after capital expenditure of $98.9 million. Capital expenditure totaled $12.8 million, primarily funding new stores, relocations, and minor refurbishments. The company maintains undrawn debt facilities with ANZ, providing financial flexibility.
Dividend Increase Reflects Confidence
Directors declared a fully franked final dividend of 17.0 cents per share, up from 16.5 cents in the prior year, to be paid on 24 September 2026. Combined with the interim dividend of 26.0 cents, total dividends for FY26 amount to 43.0 cents per share, reflecting the company’s strong trading performance and solid cash position.
Leadership Transition and Strategic Focus
Long-serving CEO Alice Barbery announced her retirement effective 31 October 2026, with George Do appointed as her successor from 1 November. Barbery will join the Board as a Non-Executive Director in February 2027 and continue to support the CTC advisory board. Do brings over 20 years’ experience with the group, having led Universal Store and Perfect Stranger divisions, and is credited with building the company’s private brand capabilities.
The group continues to invest in digital capabilities, supply chain improvements, and sustainability initiatives, including mandatory climate risk disclosures commencing FY27. Sustainability efforts focus on responsible sourcing, product stewardship, climate action, and customer engagement, with updated 2030 targets guiding progress.
Risks and Outlook
Key risks include volatile retail conditions, fashion trend shifts, competitive pressures, supply chain dependencies (notably China), and cybersecurity threats. The company’s disciplined store network management and customer-centric culture aim to mitigate these risks while driving growth.
Universal Store’s expansion plans include opening six to eight new Perfect Stranger stores and further THRILLS rollout once the retail model is proven. The group’s strong balance sheet and cash flow provide a solid foundation to navigate market challenges and capitalise on opportunities.
Bottom Line?
Universal Store’s FY26 results show resilience and strategic investment amid wholesale headwinds, with a leadership change marking a new chapter.
Questions in the middle?
- How will George Do’s leadership influence Universal Store’s growth and retail strategy?
- Can the CTC segment’s retail expansion offset ongoing wholesale declines?
- What impact will mandatory climate disclosures have on the company’s sustainability initiatives?