Operating costs are being slashed at Land of Leather as it battens down the hatches in anticipation of very tough trading in its new financial year.
Savings of about£17 million are being made by reducing staff costs, advertising and discretionary spend. The store opening programme has also been halted. Additionally, the furniture specialist is expanding its new fabric sofas offer, from seven to 11 lines ahead of the winter Sale.
In the year to August 3, pre-tax profits plummeted from£18.5 million to£2.3 million, although sales declined by just 3 per cent to£232 million. Promotional activity and exceptional items were blamed for the profit fall.
Investec analyst David Jeary judged the shares a hold in the face of “high uncertainty”, fixing a target price of 10p. House broker Kaupthing said the results were in line with expectations.
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