Fashion retailer Quiz saw shares plunge this morning as it issued its second profit warning in just three months today, after Christmas sales fell below expectations.
Profits are now expected to hit £8.4m for 2018, down from October’s estimate of £11.5m, with shares nosediving by 24 per cent in early morning trading to leave Quiz’s share price at 27p.
The Scottish firm also expects to miss full-year sales guidance of £133m, after warning they were heavily dependent on a good festive period.
Chief executive Tarak Ramzan said: “The growth and the margin achieved have been below our initial expectations and, consequently, the board considers it appropriate to revise its sales and profit expectations for the current year.
“We remain confident about Quiz's long-term potential as an omni-channel fashion brand with a clear customer focus. Management's utmost priority remains achieving further growth for the business and improving profitability in the future.”
Festive shopping at Quiz grew by 8.4 per cent in the six weeks to 5 January, compared to the same period the year before, while online revenue rose by 34.1 per cent.
Quiz’s lower Christmas sales have also led to more discounting, which will squeeze margins to 60.5 per cent, a drop from September’s 62 per cent margin.
Growing staff and marketing costs to expand the business over the past year have also hurt the retailer as revenues failed to grow to support the increased costs, leaving it with debts of but the firm said it is adamant that this investment will underpin future growth.