Rochdale HQ’d footwear and sportswear omnichannel business, is set to accelerate its growth plans across the UK and beyond after securing a £35m Revolving Credit Facility from HSBC UK.
Footasylum was acquired by AURELIUS, a global alternative investor, in August 2022 and has since embarked on a strategic store opening and upsizing programme, which has seen it open a flagship 20,000 sq.ft. store on Oxford Street in London1, as well as at multiple UK shopping destinations.
The HSBC UK RCF funding package includes a Sustainability Improvement Loan (SIL), which links the cost of borrowing to Footasylum’s sustainability performance, monitored using an EcoVadis ESG (Environmental, Social, and Governance) rating2. The EcoVadis rating will be tested on an annual basis to track Footasylum’s ESG performance. If the company improves its sustainability rating in line with pre-agreed targets3, it could benefit from reduced interest rates on the loan.
As part of its Environmental Policy, Footaslyum has committed to achieve a carbon net zero target for scope 1 and 2 emissions by 2030 and Scope 3 by 20404. The retailer began offsetting its carbon emissions in 2020 and plans to have a fully electric or hybrid fleet by 2025, with 70 per cent of logistics journeys already powered by biodiesel. In line with its sustainability efforts, Footasylum carrier bags are made from 100% recycled material and the company is committed to a Make it Wild environmental tree planting partnership5.
Footasylum plans to use the RCF funding to roll out a store expansion programme, starting with the new opening in Aberdeen in September, with Warrington and Doncaster to follow in early October. This will be followed up with two further openings in Rotherham and Wrexham later this year. The company’s Merry Hill store will be trebled in size.
These store expansion plans are expected to initially create over 100 new jobs including management, full-time, and part-time in-store positions across the UK. HSBC UK’s support will also provide Footasylum with the financial support to explore international acquisition opportunities.
In addition, the RCF will enable Footasylum to enhance its technology capabilities, with the further development of the new modular, mobile-first omnichannel retail solution. This update to the retailer’s e-commerce offering will set the foundations for a digital-first customer journey. It will also support the development of Footasylum’s key exclusive brands, including Zavetti Canada, Alessandro Zavetti, and Monterrain.
HSBC UK’s support aims to ensure that Footasylum continues to expand partnerships with influencer talent that has underpinned its successful content marketing strategy.
Nick Scott, CFO at Footasylum, said: “This funding from HSBC UK is a key milestone in our growth journey and will help us achieve our ambitious Environmental Policy. It will enable us to not only expand our footprint in key locations across the UK but also accelerate our omnichannel technology investments, continue to grow Footasylum’s highly popular exclusive brands, and incubate the influencer talent that underpins our unique and highly successful marketing strategy.
“We’re hugely excited about the opportunities ahead and the positive impact these plans will have on both our business and the communities we serve.”
Zubayr Atcha, global relationship director, corporate banking for HSBC UK, added: “We are pleased to support a leading omnichannel retailer such as Footasylum in its next phase of growth. This funding will provide the flexibility needed to drive expansion plans, support their sustainability strategy and further establish the retailer’s presence in the fast-growing street and sportswear market.
“Footasylum is a dynamic force in the consumer space, and we’re thrilled to be a part of their continued success and sustainability journey.”
With over 61 stores nationwide, Footasylum recently achieved record breaking results with revenues of £319.5m for the year to 27 January 2024, up from £298m in the previous financial year6. During the period, Footasylum’s profit before tax rose 112%, supported by strong performances in its Online and Wholesale divisions.
Footasylum’s social media following has grown by 1.4 million in the past year alone, reaching 5.8 million across YouTube, TikTok and Instagram. This growth was driven by the success of the fourth series of Locked In, Footasylum’s online creator reality series, which has garnered 37 million views.
