- Moss Bros blamed tough trading conditions and product shortages
- Full-year pre-tax profits down 6.1% at £6.7million
- Like-for-like retail sales for first 8 weeks of new financial year down 6.7%
Menswear company Moss Bros blamed tough trading conditions and continued product shortages for a fall in sales and profits and warned of ‘extremely challenging’ times ahead.
Moss Bros, which has already issued two profit warnings this year – one of which last week – posted a 6.1 per cent fall in pre-tax profits to £6.7million for the year to the end of January.
The new financial year did not start on a good foot either, with like-for-like retail sales for the first eight weeks down 6.7 per cent, as product shortages that have been hitting trading since last year continued.
Out of fashion? Moss Bros blamed stock shortages and tough consumer environment
Chief execuitve Brian Brick said: ‘Going forward, we are planning for an extremely challenging retail environment, not least because of the uncertain consumer environment and significant cost headwinds.
‘However, there is no question that we have hampered our own position through the stock shortages and as this gets back on track, our strong consumer proposition is restoring momentum. We will ensure that we continue to invest in this proposition to protect our position.’
Concerns over the health of high street retailers like Moss Bross have been mounting after Toys R Us and Maplin crashed into administration this year, while New Look is preparing to shut 60 stores.
Today’s results are no big surprise after Moss Bros said last week that sales had suffered a triple whammy from stock shortages, low footfall and sluggish suit hire demand, and that meant profits would be ‘materially lower’ than current market expectations for the year to January 26 2019.
It also slashed its full-year dividend by 32 per cent to 4p.
Shares took a hammering last week, falling by nearly 30 per cent. Today they fell 3 per cent in early trading to trade 0.5 per cent lower at 46.50p.
Moss Bros expects to resolve the stock shortages by late spring, but this will be too late to prevent a hit to this year’s results.
Moss Bros, which has 129 stores across the UK, said trading had worsened rapidly in the fourth quarter after a strong performance throughout the rest of the year.