BON.L Share News (BON)

(ShareCast News) - Clothing retailer Bonmarche shares was under the cosh on Wednesday after Canaccord Genuity cut its rating to 'hold' from 'buy' and lowered its target price to 90p from 160p.The company last week issued a profit warning after reporting poor sales of its autumn range in September due to recent hot weather. Bonmarche said its full year profit before tax is likely to fall within a range between £5m & £7m. It also expects first half like-for-like (LFL) sales will drop 8%."Given the volatile trading conditions and potential wider-scale clothing sector discounting to monetise excess inventory, we have erred towards the conservative end of this guidance," Canaccord said."Management has a good track record on managing operating costs in relation to top line evolution, but the severity of first half's LFL declines cannot be fully mitigated by such measures."Canaccord added that the company's shares could be helped by a return to more seasonal weather patterns and a favourable reaction to new chief executive Helen Connolly's plans when laid out eventually.The broker said the new profit before tax guidance is a "major disappointment" even if driven primarily by weather."With trading volatile, and in the absence of the new CEO's plans, we believe it prudent to assume a modest rate of pre-tax profit recovery going forward."On any further reduction to our fiscal year 2017 EBITDA forecast we would potentially be forecasting a technical breach of the sole covenant on the undrawn revolving credit facility, which on our revised forecasts remains just above the minimum 1.5:1 adjusted EBITDAR to net finance charges ratio. "Shares fell 2.75% to 93.25p at 0913 BST.