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17 Feb 2009 07:00
LAURA ASHLEY HOLDINGS PLC
Trading Update
17 February 2009
Laura Ashley Holdings Plc is today updating the market on trading for its full year ended 31 January 2009.
As indicated in Laura Ashley's Interim Management Statement on December 19 2008, the current volatile economic climate has led to challenging trading conditions in the UK. Since December, the continued deterioration of the UK economy, its impact on the retail sector and consumer confidence, the weakness of Sterling and increased promotional activity have resulted in additional pressure on gross margins. As a consequence, it is anticipated that the profit before taxation and exceptional items for the year ended 31 January 2009 will be in the region of £9.0 million, lower than current market expectations.
For the financial year ended 31 January 2009, total UK store sales increased by 10.8%* against last year largely due to the increase in retail selling space. As part of our store realignment programme, 29 stores were opened and 9 were closed during the year. We now have 228 stores in the UK. However, on a LFL basis, UK store sales declined by 6.2%* against last year.
We have continued our focus on developing our franchise and licensing business with several new agreements concluded in the financial year ended 31 January 2009. We now have 223 franchised stores internationally and our partners are committed to open more over the coming year and years ahead. We expect growth in our franchising and licensing network as we look for more opportunities in countries where the Brand has yet to be represented.
Our Internet sales have continued to show robust growth with an increase of 65.4%*. This is partially offset by a decline in Mail Order sales.
In line with the general economy, we expect the coming year to remain challenging and unpredictable with economic uncertainty impacting consumer confidence and spending patterns.
We have a strong Balance Sheet and we are taking the right actions by continuing to focus on increasing revenue generation through our various channels, improving operational efficiencies, differentiating our product offering and continuing to invest in our store realignment programme subject to our stringent property selection criteria.
We will be announcing our full results for the year ended 31 January 2009 at the end of March 2009.
* Based on 53 weeks for the year ended 31 January 2009 against 52 weeks for the year ended 26 January 2008.
Enquiries:
Rebecca Navarednam Laura Ashley 0207 880 5100
Chief Financial Officer and
Company Secretary
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