Good news from Laura Ashley made the small stock the week’s biggest riser. In its fifth consecutive year of improvement, profits surged 62 per cent to£19.8 million, on group sales ahead 5.6 per cent to£237.6 million. Its UK like-for-likes fell 8.7 per cent, but the company said: “We do not see this as a cause for concern.”
Fashion tiddler Alexon also managed to notch up higher preliminary pre-tax profits – up from£15.1 million to£16.4 million – on sales down£10 million to£262.1 million. Panmure Gordon said the retailer had “done a good job in exiting loss-making activities”, but tough trading conditions are a reason for continued caution on the stock.
Interim profits at Clinton Cards climbed from£20.2 million to£23.3 million on flattish sales of£256.9 million. Chairman Don Lewin said “the high street remains challenging”, but product differentiation and improvements at the retailer’s eponymous and Birthdays stores gave him “a degree of confidence”.
Carpetright made two small acquisitions in the UK and the Netherlands. Shore Capital welcomed the deals, but rates Carpetright a sell. The broker has cut its forecasts in the light of a slowing housing market and “more downbeat trading expectations from the upholstery retailers and other home-related sales”.
Pali International downgraded electricals giant DSGi from neutral to sell and cut its target price from 60p to 53p a share. The broker expects a dividend cut and said: “The efforts of a new chief executive to turn things around are likely to be swamped by the cyclical downturn and the impact of the credit crunch on household spending.” Pali advised switching into Kesa, which has completed the sale of its BUT furniture chain in France.
Findel said it expects record group sales of£640 million in the financial year just ended. Home shopping sales should show a rise of about 23 per cent, with more than half of transactions being online.
Merrill Lynch Private Equity, a pre-float backer of department store group Debenhams, sold its remaining 6.2 per cent stake last week. Kaupthing noted: “Having sold out at a knock-down price and given concerns about debt and competition in the clothing market, Debenhams’ trading range may suffer.”
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