Laura Ashley warns on profit as like-for-like sales fall
Fashion and home furnishings retailer Laura Ashley has said its full year profit will fall below market expectations after reporting a 3.5% drop in first half like-for-like retail sales.
In the 26 weeks to 31 December, group sales reached £146 million compared to £149.8 million in the corresponding period last year.
Pre-tax profit fell to £7.8 million from a previous £11 million.
Looking at categories, like-for-like furniture sales were down 8% in the period while decorating like-for-like sales fell by 6.4%. Fashion like-for-likes decreased by 3.2% but home accessories fared better with a like-for-like increase of 2.5%.
Commenting on the results, Laura Ashley chairman Tan Sri Dr Khoo Kay Peng, said: “Trading conditions have been demanding during the first six months of the year ending 30 June 2017. The board have reviewed the first half results and forecasts for the remainder of the year to 30 June 2017 and, given the continued market challenges, feels that net pre-tax profit for the year will fall below market expectations.”
The company said it is continuing to grow its international presence and explore new partnership opportunities. During the period, international operations contributed 7% of total group revenue. As at 31 December 2016, there were 251 franchised stores in 29 territories worldwide.
During the first half, Laura Ashley signed a new licence partner for the India market and launched a website in China.
Tan Sri Dr Khoo Kay Peng added: “Despite the well-documented pressures in the broader commercial environment, there have been a number of positives in the first half and the business is well placed to respond to the challenges ahead. We are committed to delivering the best possible multichannel experience for our customers.
“Looking ahead, the ongoing investment to enhance the online experience will add to the already rich heritage of this great British Brand and bring Laura Ashley to a larger and more international audience.”
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