New Stores Drag Down Laura Ashley

Telegraph.co.uk:

Laura Ashley, the clothing and furniture retailer, has seen a significant drop-off in sales following weaker consumer spending over the first 4 months of its financial year.

Over the 17 weeks of its current financial year, like-for-like sales at the retailer fell by 7.6pc compared to last year. The company said that uncertainty arising from the economic climate, coupled with cannibalization from existing stores, was to blame.

‘We are busy opening new stores but it is tough out there,’ said David Cook, finance director.

Despite the falling sales, margins at the company improved by just below two percentage points. Total sales - stripping out the effect of 10 net new store openings - rose by 7.9pc. The group said that it is confident of hitting analysts’ profit forecasts.

Franchising and licensing sales at Laura Ashley saw marginal declines over the period. However, its mail order and internet division rose by 8.1pc.