Tuesday, 8 August 2017

Fashion chain New Look warns on 'fragile' outlook as profits plunge

Fashion chain New Look has warned of a "fragile" retail environment stretching into next year as it reported a 60% fall in quarterly profits amid a sharp downturn in sales.

It was the latest sign of the tough times facing the UK high street as a report from the British Retail Consortium (BRC) showed a slowdown in sales growth for July.

New Look said underlying operating profit fell to £12.1m for the 13 weeks to 24 June, down from £30.5m in the same period last year.

Like-for-like sales in the UK slumped by 7.5%.

The company pointed to tough conditions on the high street as well as acknowledging that its offering had missed the mark in recent months.

Profits were also squeezed by the collapse in the pound since the Brexit vote - pushing up the retailer's buying costs while at the same time it cut prices for key clothing lines.

Chief executive Anders Kristiansen said: "As expected, the UK market has remained difficult, which has resulted in a disappointing quarter of trading.

"Looking ahead, we expect the consumer economy to remain fragile and challenging market conditions to persist into 2018."

SKY     News.