Laura Ashley this week set out how it would focus on online expansion into new markets following six months in which sales and profits fell, and as it warned that full-year profits would fall short of expectations.
The homewares-to-fashion retailer launched online in China in November 2016 and now says it plans to continue to develop its ecommerce business through international growth. The trader already delivers to eight European countries, with delivery recently added to the Czech Republic and Hungary. It will also add new payment solutions to its German, French and Benelux operations in coming months.
Online was also one of the only areas of growth for Laura Ashley [IRDX RLAU] in the first six months of its financial year, as it contended with rising costs in the light of the Brexit vote.
The fashion-to-homewares retailer this week reported group sales of £146m in the 26 weeks to January 30, 2.5% down from £149.8m at the same time last year. Like-for-like retail sales, which strip out the effect of store openings and closures, were down by 3.5%. Pre-tax profits of £7.8m were down from £11m at the same time last year. Growth came both from the online business and from its hotel business. Online sales grew to £25.6m, from £25m last time, and online sales grew by 2.1%.
Dr Khoo Kay Peng, chairman, said: “”Despite the well-documented pressures in the broader commercial environment, there have been a number of positives in the first half and the business is well placed to respond to the challenges ahead. We are committed to delivering the best possible multichannel experience for our customers. Looking ahead, the ongoing investment to enhance the online experience will add to the already rich heritage of this great British brand and bring Laura Ashley to a larger and more international audience.
“Continuing to grow and develop our international presence and explore new partnership opportunities is an important part of our strategy and we have made good progress in the half. We signed a new licence partner for the India market which strongly positions the brand for advancing in a major country. We are also pleased to now have a presence in China, having launched a website in November.
But the company warned that full-year profits would be down as a result of “demanding” trading conditions and rising costs.
But the chairman remained confident. “As we connect with new customers, both in the UK and worldwide, our ongoing commitment to design, quality and innovation will ensure that the Company and the Brand continues to resonate with its existing loyal customer base,” said Dr Khoo. “I am confident that Laura Ashley is well positioned to continue its progress and make the most of the opportunities ahead.”
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