Last checked at 5 Nov 2008 07:00
For Immediate Release 5 November 2008
Ideal Shopping Direct PLC
(the 'Company')
Trading Update
Current market conditions have had a negative impact on sales. Total net revenue for the seven weeks from 7 September 2008 to 26 October 2008 was 10% lower than in the comparable period last year. This compares with an increase in total net revenue for the first ten weeks in the second half, as reported in the interim announcement on 15 September. As a consequence, cumulative net revenues for the first four months of the second half have fallen to 3% below the previous corresponding period, significantly short of management expectations.
In the remainder of the critical final quarter of the year, when trading is traditionally stronger, the Board anticipates a lower than expected gross margin from the sales mix, which in addition to the reduced sales levels, will have an impact on profitability. Together with higher than budgeted overhead costs of £0.9m, the Board anticipates a small trading loss for the year to 28 December 2008 before taking charges of £0.8m for stock provisions and £0.9m of exceptional costs, £0.6m of which represents cash held on deposit with Kaupthing that the Board considers unlikely to be recoverable.
The Company's cash balance at 26 October 2008 was £5.7m and the Board anticipates that the cash balance at 28 December 2008 is expected to be approximately £9.0m.
The Company expects to report its pre-close trading update for the year to 31 December 2008 in mid-January 2009.
For further information please contact:
| David Williams, Chairman Mike Hancox, Chief Executive | ||
| Ideal Shopping Direct | 020 7466 5000 | |
| Michael Meade, Oliver Cardigan - Nominated Adviser Mark Lander - Corporate Broking Numis Securities | 020 7260 1000 | |
| Richard Darby, Miranda Higham | ||
| Buchanan Communications | 020 7466 5000 | |