Frasers Group has warned the Budget has “spooked” consumer confidence as it prepares for its tax bill to rise £50m next year from changes to employers’ National Insurance contributions.
The retail giant’s CFO Chris Wootton noted that consumer sentiment has “definitely weakened pre- and post-Budget”.
“It’s obvious to anyone on the high street that the Budget has really spooked people, and frankly, the 24/7 bad news stories around it have sort of compounded that,” he said.
His comments come as the Sports Direct owner reported it had lowered its profit expectations for the year by £25m, citing “tougher” trading conditions after half-year sales in its retail arm fell 8.4% to £2.45bn.
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The group, which was relegated from the FTSE 100 index this morning, is also in the midst of a boardroom battle with Boohoo.
Frasers, which owns a 27% stake in the fast fashion giant, has been campaigning for its founder Mike Ashley to take a seat at the board and put an end to what it described as “dismal results, lack of transparency, terrible refinancing, and further supply chain allegations”.
Commenting on the ongoing saga between the pair, Wootton said: “We want to see Boohoo realise its potential and at the moment, we feel it’s not.
“We’ve invested a lot of money in that business, we see great partnership potential, we’ve been a supportive shell for a very long time, but we feel there’s some significant areas of improvement that need to be made.”
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