Flying Brands warning about profits

A disappointing Easter has forced Flying Brands to warn about profits. The retailer was counting on a strong response to its Gardening Direct mail campaign in March and April. However, the early Easter holiday failed to provide the uplift in sales that the retailer was looking for.

Although the final mailing for the spring season, slated for the middle of this month, is expected to yield results from later season demand it will not be sufficient to offset the lack of sales from the campaign to date.

The retailer said: 'Our other brands remain on track, but because Gardening Direct Spring is the largest campaign of the first half, its performance means that it is unlikely that we will deliver profit levels in line with market expectations.'

In other news, the retailer said that it had signed an agreement to acquire Silver Minds Direct, a music and video business, and has appointed former Cable & Wireless chief financial officer Graham Norton as its finance director and company secretary.

Analyst Seymour Pierce applauded the Silver Minds acquisition, saying that is was likely to cost less than£1 million, but would allow the group to take advantage of its existing infrastructure. However, the warning on profits was a more serious matter.

Seymour Pierce analyst Richard Ratner said: 'Overall a very disappointing update with Gardening Direct's poor performance bringing the profitability of the whole group down. As such, we now look for£5.5 million [pre-tax profit] for the year, down from£6.15 million.'