Moss Bros posts flat half-year profit

UK menswear company Moss Bros said half year profit was unchanged after a strong retail performance was weighed down by weak hire sales, and expects the full year outcome to be in line with market expectation.For continuing operations pre-tax profit remained at £2.2m and operating profit climbed 5.4% to £2.2m. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) improved to £4.4m from £4.3m in 2012. Total sales for the continuing business rose 1.2% on last year.Like-for-like (LFL) retail sales, which include a 164% increase in e-commerce sales, rose 1.7%. LFL hire sales fell 7.2%, as anticipated. Group LFL sales were level to the previous year.Gross margin from continuing operations fell 0.7% to 59.7% while retail gross margin improved 0.4%.Moss Bros said trading in the eight weeks to September 21st 2013 has been encouraging with LFL sales up 4.9% as trading improved, boosted by more seasonally normal weather. "The board, although mindful of the fragile external trading environment, anticipates that the outturn for the full year will be in line with market expectations," it said.Chief Executive Officer Brian Brick said: "Trading improved during the period as the abnormally cold and wet weather in February and March was replaced by more seasonal conditions. Hire, as anticipated, had a difficult first half but we expect an improvement in the second half of the year as we move out of the wedding season into evening wear." "The early response to the Autumn/Winter range is positive, with LFL sales continuing to improve year on year and gross margins showing an improving trend against the prior year, as we move out of the summer clearance activity.""The group's trading performance continues positively, in line with the board's expectations." The interim dividend has been increased 50% to 0.3p per share.CJ