Business

Thursday September 10, 2009

Laura Ashley hit by forex losses

By CHOI TUCK WO


LONDON: Laura Ashley Holdings plc has chalked up a resilient performance against the backdrop of a weak economy, with a pre-tax profit of £1.1mil (RM6.6mil) for the first half ended Aug 1.

The 77% drop in profit was attributed to foreign exchange losses of £5.5mil (RM33mil) due to the pound’s slide against the euro and US dollar.

It declared an interim dividend of 0.25 pence per share, payable on Nov 12.

The interim results were released to the London Stock Exchange yesterday.

Laura Ashley’s flagship store at Westfield, London, is Europe’s largest shopping mall.

Chairman Tan Sri Dr Khoo Kay Peng said the company had once again demonstrated its resilience, outperforming the British market in all its product categories.

He said both the international and e-commerce operations had achieved growth in what had been a challenging consumer environment.

Khoo said the retail outlook remained uncertain but expressed cautious optimism that the positive momentum would continue through to the year’s end.

“We’re well positioned with our key focus on operational efficiencies, excellence in product offering and multi-channel retailing,” he said after the board meeting.

Group sales shot up by 6.3% from £120.2mil to £127.8mil while British retail sales increased in all categories, rising by 6.1% to £101.5mil.

Total sales growth has been driven by improved product offering, increasing selling space from the store realignment programme and targeted promotional activities.

The British sales are split into four main categories, with furniture accounting for 27%, home accessories 26%, decorating 24% and fashion 23%.

Furniture sales bucked the trend with a 19.1% growth, largely due to extra promotions, success of range expansions, updates, improved stock management and availability.

Home accessory sales rose by 10.2%, driven mainly by continued success in children’s bed-sets, co-ordinating accessories, home fragrance, novelty door stops and cushions.

Decorating sales were up 6.1%, mostly from statement wallpapers, new colours, strong stripes and decorative accessories while fashion sales soared by 14.5% owing to stronger product offer and extra space from new and existing stores.

E-commerce sales again outshine mail order, rising by 36.1%, while the store expansion programme continued at a measured pace, with five new stores opened and two closed, bringing the total to 231 in Britain.

As part of its franchising activities, its new Middle East and Asian franchise partners have opened two stores in Dubai and five in China while opportunities in Russia, India and other Asian countries are being explored.

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