Laura Ashley first half profits surge

Group turnover increased 5.7% to £135m, powered by online sales and the UK arm, which notched up a 5.5% increase in revenue to £121.6m. UK like-for-likes were up 6.2%.

UK sales growth has slowed in recent weeks, with like-for-likes increasing 4.9% in the 31 weeks September 4.

Including an exceptional gain due to the sale and leaseback of a freehold property, the retailer notched up £10.5m in pre tax profits in the six month period, compared with £1.1m in the corresponding period last year.

Gross margin improved 1.4 percentage points as the retailer benefited from stronger Sterling and lower promotional activity.

Furniture, which makes up 30% of Laura Ashley’s sales, experienced a 7.8% uplift in sales, with like-for-likes up 9.2%. In home accessories sales grew 5% with like-for-likes up 5.2%.

Fashion sales were up 4.3% on like-for-like growth of 1.6% at the 225-store retailer, “despite facing tough comparatives”.

E-commerce sales rocketed 63% to £15.4m.

Laura Ashley operates 233 franchised stores across 26 countries, where revenues grew 3% to £10.4m in the period.

The retailer closed six UK stores in the period, and will continue to realign its portfolio in 2010, focusing on the acquisition of “smaller, new concept stores” while “optimising space” in its existing portfolio.

Laura Ashley chairman Tan Sri Dr. K P Khoo said:  “I am delighted with the strong performance of the Company for the first half of this financial year. In a difficult economic climate, Laura Ashley has continued to demonstrate the strength of its brand and has recorded positive like-for-like sales growth across all product categories.

“Our E-Commerce and international channels have continued to grow and become increasingly important to our multi channel strategy.

“We will focus on developing Laura Ashley’s distinctive product offering as well as improving operational efficiency. The consumer environment continues to be uncertain and we remain cautious for the remainder of the year.”