Furniture and fashion-seller Laura Ashley was hit by a rough retail sector, its chief executive said this morning, as the company fell into the red.
Loss before tax and exceptional items hit £9.8m at in the full year to 30 June. Last year the company made a £5.6m profit.
It comes as like-for-like sales decreased 3.5 per cent at the company, with total sales down 9.6 per cent to £232.5m.
As a result, the board has said it will not recommend a dividend for the year.
A rare silver lining was its range of fashion, where like-for-like sales grew 9.2 per cent. “This is the result of the improved design of our ranges,” said chair Andrew Khoo.
The company did not even get breathing space online, where other struggling retailers have sometimes managed to claw back parts of their high street losses. Online revenue dropped 14.2 per cent to £51.2m.
Julie Palmer at Begbies Traynor, a corporate restructuring firm, warned that more store closures could come after these results.
“The news won’t come as a surprise for shareholders, following dismal trading conditions and two profit warnings announced earlier this year. The loss of £14.3m has been impacted by a relaunched website which is still teething and poor homeware sales,” she said.
Khoo recognised that the company was facing headwinds. “The last twelve months have proved to be a difficult trading period for the group and indeed for the retail sector as a whole,” he said.
He put the fall down to the home furnishing business and a re-platforming of its website.
“We have focused on the reasons why home furnishings have underperformed and have taken necessary steps to mitigate this, including adding new contemporary product to our ranges. We have taken active steps to listen to our customers and now believe that we are on an appropriate recovery path,” Khoo said.
Shares fell nearly five per cent to 1.75p by 11am.
Main image credit: Getty