The once-loved textile designer and retailer Laura Ashley has seen its share price plummet on the open, as sales fell again and profit shrank.
Laura Ashley pulled in total sales of £134.7m in its first half up to December 2017, down from £146m a year prior. Total like-for-like retail sales dropped by 0.5 per cent – only online revenue grew slightly, from £25.6m to £26.9m.
Profit before tax slipped from £7.8m to £4.3m, while sterling's weakness was blamed for margin pressures. The board slashed the dividend down to zero, from 0.5p last year.
Shares plunged as much as 27 per cent on the open, but have since recovered to be down around 1.64 per cent.
Why it's interesting
Though Malaysian-owned Laura Ashley has fallen out of favour as a clothing and homeware brand in recent years, the company is trying hard to push into new areas and perhaps revive a sense of nostalgia associated with its quaint image.
It has decided to push its hotel concept through licensing both nationally and internationally, following the "success" of The Belsfield in the Lake District.
Earlier this month, Laura Ashley also announced it was terminating its licensing agreement which spanned Japan, Taiwan and Hong Kong with Japanese retailer Aeon Co. It put a positive spin on that today, saying it would allow the company to "develop the Brand presence ourselves in these territories through a licensing and online model".
What Laura Ashley said
"Trading conditions have continued to be challenging during the first six months of the year to 31 December 2017. The impact felt due to the weakening of sterling, year on year, was the most significant single factor in the fall of profit before tax," said the company's chairman Khoo Kay Peng.
"We will continue to develop our international presence and explore new partnership opportunities. During the first half, we have signed a new licence partner for the territory of Thailand. In China, our website is now available on two major platforms with another two to be added during the second half."