Matalan price gets a boost

FASHION and homewares retailer Matalan has boosted its £1.5bn auction by revealing further strong growth over the Christmas period.

The group revealed that like-for-like sales rose 13.7 per cent in the five weeks to 2 January.

The upbeat trading statement came despite tough comparatives with positive trading figures seen a year earlier.

Five private equity firms are believed to be circling for the business, which was founded by John Hargreaves.

Hargreaves took Matalan private in an £827m deal backed by £410m of debt three years ago.

Chief executive Alistair McGeorge said the group remained in talks with a number of potential bidders and expected to give an update on the sale process later this month or early next month.

“To have a business performing well doesn’t do any harm,” he said, adding Matalan was taking custom from mid-market rivals, which could include Marks & Spencer and Debenhams, and was stepping up its store opening programme.

The company relies on cut-price clothes and homewares to attract customers to its 205 stores.

Operating profits hit £102m in the year to 28 February – up from £89.4m a year earlier.

Sales were up by 9.3 per cent in the 13 weeks to 2 January, with total sales ahead 10.4 per cent to £362m.

McGeorge said the company had not resorted to the deeper discounting tactics seen elsewhere. Matalan’s end of season sale, which was launched on Christmas Eve, also performed strongly.