6 Mar 2009 15:57
John Lewis of Hungerford plc
("the Company")
Trading Update
At the time of announcing its 2008 results at the end of November 2008 the Company reported that, in view of the tough trading climate that the kitchen industry was facing, management were focused on maintaining sales growth and controlling costs. In addition the Company disclosed it was seeking to appoint a replacement for Richard Worthington.
The Company is pleased to announce that Karen Stanley has joined the Company to head up the finance function. Karen has extensive experience as a Finance Director within the construction and property sector after training initially at Price Waterhouse Coopers. A restructuring exercise is also nearing completion and is expected to result in annualised savings of approximately £200,000 from the commencement of the 2009/2010 Financial Year. This has been enabled, primarily due to the investments made by the company in systems and working practices.
The new showrooms that were opened in 2008 in Cambridge and Oxford continue to perform very favourably and the Company experienced very high levels of interest during its recent winter sale. However, customers are more cautious and appear to be taking longer to make decisions and place orders and consequently the Company's turnover for the six months ended 28 February 2009 is likely to fall to approximately £1.6 million. As a result of this and the costs associated with the restructuring exercise the interim operating loss is likely to be significantly greater than last year.
Despite this and the need to remain cautious and monitor events closely, given the state of the economy, the Directors remain of the view that the Company is well positioned compared to many of its competitors. As of the end of February the order book was up 26% on last year, partly due to the delays in orders being placed, and this is expected to generate sales in March about 40% ahead of last year and to produce positive cash flow throughout the coming months. In addition the Company has recently renewed its overdraft facility of £250,000 with Barclays, although this option has not been used. The Directors are confident the Company has sufficient working capital for its present requirements.
The Company has just launched an on-line shop featuring a revamped range of furniture and accessories. This will give nationwide access to the John Lewis of Hungerford brand.
For further information please contact:
Jon Rosby, Managing Director
John Lewis of Hungerford plc
Tel: 01235 774300
David Abbott
Smith & Williamson Corporate Finance Limited
Nominated Adviser to the Company
Tel: 0117 376 2213
6 March 2009