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Mothercare and Laura Ashley see UK sales fall | Mothercare and Laura Ashley see UK sales fall |
(40 minutes later) | |
Shares in retailers have come under pressure again after Laura Ashley and Mothercare both reported falling sales in recent weeks. | Shares in retailers have come under pressure again after Laura Ashley and Mothercare both reported falling sales in recent weeks. |
Laura Ashley said UK like-for-like sales fell 4.2% for the eight weeks to 26 March. Its shares closed down 15%. | Laura Ashley said UK like-for-like sales fell 4.2% for the eight weeks to 26 March. Its shares closed down 15%. |
Mothercare shares ended 9.5% down after it said UK like-for-like sales slid 2.4% in the first three months of 2011. | Mothercare shares ended 9.5% down after it said UK like-for-like sales slid 2.4% in the first three months of 2011. |
The retail sector is preparing for a tough year, with consumers being hit by higher fuel and food prices. | The retail sector is preparing for a tough year, with consumers being hit by higher fuel and food prices. |
Consumer confidence is also being affected by worries over government spending cuts, analysts say. | Consumer confidence is also being affected by worries over government spending cuts, analysts say. |
The figures from Laura Ashley and Mothercare come a day after electrical goods retailer Dixons issued a profit warning, with underlying sales down 7% in the past 11 weeks. | The figures from Laura Ashley and Mothercare come a day after electrical goods retailer Dixons issued a profit warning, with underlying sales down 7% in the past 11 weeks. |
There was further gloomy news from the latest consumer confidence survey by GfK NOP Social Research. | There was further gloomy news from the latest consumer confidence survey by GfK NOP Social Research. |
It found that confidence among UK consumers had "stagnated at depths seldom seen outside of actual recession". | It found that confidence among UK consumers had "stagnated at depths seldom seen outside of actual recession". |
'Significant pressure' | 'Significant pressure' |
Laura Ashley said it believed that UK consumers were increasingly unwilling to part with their money. | Laura Ashley said it believed that UK consumers were increasingly unwilling to part with their money. |
"There has been a decline in performance since the beginning of February, which we attribute to a general weakening in the consumer economy," the company said. | "There has been a decline in performance since the beginning of February, which we attribute to a general weakening in the consumer economy," the company said. |
However, its comments came as it reported a healthy rise in annual profits. | However, its comments came as it reported a healthy rise in annual profits. |
For the 12 months to the end of January, its pre-tax profits rose to £24.1m from £11m the year before. | For the 12 months to the end of January, its pre-tax profits rose to £24.1m from £11m the year before. |
Meanwhile, baby goods firm Mothercare said it expected UK retail profits to remain under "significant pressure" in 2011-12. | Meanwhile, baby goods firm Mothercare said it expected UK retail profits to remain under "significant pressure" in 2011-12. |
It said profit margins were taking a bigger-than-expected hit as difficult conditions forced it to discount stock. | It said profit margins were taking a bigger-than-expected hit as difficult conditions forced it to discount stock. |
Mothercare's problems in the UK overshadowed its strong performance overseas, where sales from franchises increased 10% in the fourth quarter. | Mothercare's problems in the UK overshadowed its strong performance overseas, where sales from franchises increased 10% in the fourth quarter. |