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Laura Ashley swings to loss as home furnishings division struggles
22nd Aug 2019 09:22
(Sharecast News) - Laura Ashley said on Thursday that it swung to a full-year loss as sales fell amid weakness in the home furnishings business.
In the year to 30 June 2019, the retailer swung to a pre-tax loss of £14.3m from a profit of £100,000 in 2018 as total group sales declined to £232.5m from £257.2m. Total like-for-like retail sales were down 3.5%, while fashion LFL sales were 9.2% higher. Meanwhile, online revenue dropped to £51.2m from £59.7m.
Chairman Andrew Khoo said it had been a "difficult" year for the group and the sector as a whole. He attributed the drop in profit to the performance of the home furnishings business and the website following a re-platforming exercise which took place in November 2018.
Sales of furniture, the group's most expensive product category, fell 10.1% over the same period last year, with LFL sales down 9%. Laura Ashley said there was some impact from weak consumer confidence, particularly at higher price points.
Decorating sales were down 15% during the year, with LFL sales 13.7% lower, while home accessories sales for the year fell 0.8%, with LFL sales up 1.1%.
"We have focussed on the reasons why Home Furnishings have underperformed and have taken necessary steps to mitigate this, including adding new contemporary product to our ranges," said Khoo.
"We have taken active steps to listen to our customers and now believe that we are on an appropriate recovery path. We continue to invest in our website and are working with our online service providers to ensure that it is optimised to deliver an enhanced customer experience and to achieve the desired growth.
"We are pleased with the continued resurgence of our fashion business, achieving like-for-like growth of 9.2%. This is the result of the improved design of our ranges."
The company did not recommend a dividend for the year.
In the year to 30 June 2019, the retailer swung to a pre-tax loss of £14.3m from a profit of £100,000 in 2018 as total group sales declined to £232.5m from £257.2m. Total like-for-like retail sales were down 3.5%, while fashion LFL sales were 9.2% higher. Meanwhile, online revenue dropped to £51.2m from £59.7m.
Chairman Andrew Khoo said it had been a "difficult" year for the group and the sector as a whole. He attributed the drop in profit to the performance of the home furnishings business and the website following a re-platforming exercise which took place in November 2018.
Sales of furniture, the group's most expensive product category, fell 10.1% over the same period last year, with LFL sales down 9%. Laura Ashley said there was some impact from weak consumer confidence, particularly at higher price points.
Decorating sales were down 15% during the year, with LFL sales 13.7% lower, while home accessories sales for the year fell 0.8%, with LFL sales up 1.1%.
"We have focussed on the reasons why Home Furnishings have underperformed and have taken necessary steps to mitigate this, including adding new contemporary product to our ranges," said Khoo.
"We have taken active steps to listen to our customers and now believe that we are on an appropriate recovery path. We continue to invest in our website and are working with our online service providers to ensure that it is optimised to deliver an enhanced customer experience and to achieve the desired growth.
"We are pleased with the continued resurgence of our fashion business, achieving like-for-like growth of 9.2%. This is the result of the improved design of our ranges."
The company did not recommend a dividend for the year.