BON.L Share News (BON)

(Sharecast News) - Bonmarche blamed waning interest in high street shopping for a sharp downturn in store sales that will cause profit to shrink this year.The women's value retailer said store sales in its second quarter were below expectations. As a result, profit for the year to the end of March will fall to about £5.5m from £8m a year earlier, the company said in a trading update.Bonmarche shares plunged 20% to 82.55p at 09:52 BST on Thursday.The profit warning is an abrupt turnaround from late July when Bonmarche said trading had improved, particularly in stores, helped by warm weather. Based on that trend the company had predicted rising profit for the current year.Online sales have continued to grow but in-store sales have deteriorated, the company said in its revised update."The continuation of warm weather for an extended period may have delayed demand for early autumn stock, but we believe that the more dominant factor is that underlying consumer demand for the UK high street is weaker which is impacting footfall."Bonmarche has reduced its estimate for store sales for the rest of the year. It will cut discretionary spending but not to the point where this blocks investment for growth, the company said. It said changes to accounting guidelines meant it had to make an extra £1m provision for impairments to store values.Helen Connolly, Bonmarche's chief exeutive, said: "These are undoubtedly challenging times in the retail industry and, in common with many other businesses, Bonmarche's store trading has been impacted by weaker consumer sentiment and footfall. We have continued to improve our proposition, particularly our digital capabilities, reflected in the strong online sales."The company said its financial position was sound with an undrawn £10m revolving credit facility and cash in the bank expected to be £4m at the end of the year, down from £5.3m a year earlier. It is planning to freeze the annual dividend at 7.75p a share.Retail profit warnings have doubled in the past year as companies such as Debenhams and Moss Bross have struggled to cope with subdued consumer spending and rising costs. Non-listed retailers such as New Look have also struggled and House of Fraser was bought out of administration by Sports Direct.Bonmarche's experience over the summer contrasts with Next. Its bigger rival had expected strong summer sales to go into reverse in August and September but the company upgraded full-year guidance after sales held up.