Homeware and fashion retailer Matalan has reported a 4.5 per cent decrease in like-for-like (LFL) sales for the 19 weeks to January 8th 2011, with the snowy weather blamed for the drop in trading.
With so many stores located in out-of-town retail developments, the business found it particularly difficult to attract customers to its shops in the freezing conditions throughout December.
Longer term sales trends paint a more positive picture for Matalan, although the difficult economic conditions mean there are obviously some challenging times ahead.
Total revenue for the 39 weeks ending November 27th was £836 million, which represented an increase of 0.7 per cent year-on-year, while EBITDA is almost identical to its 2009 level at £134.9 million.
Operating profit before exceptional items increased to £110.3 million, but LFL trading slipped 0.6 per cent compared to the same period one year before.
During the last two years Matalan has made a number of changes to ensure it is meeting the demands of today’s discerning customer, including the opening of a ‘store of the future’ in High Wycombe.
Ten new outlets have now opened in total over the last two years and LFL growth for that period is a more encouraging seven per cent, which suggests that improvements made are having a positive affect.
Paul Gilbert, who replaced Alistair McGeorge as CEO of Matalan in October 2010, said: “Matalan has delivered solid results through to the end of November in a challenging market.
“The extreme weather experienced in December was frustrating, however, we have managed the terminal stock risk and our cash balances well.
“The year ahead will be demanding and our focus will be on maintaining our price competitiveness, driving further efficiency into our cost base, continuing to invest in new stores and growing our customer base.”