Total group sales for fashion and furniture retailer Laura Ashley grew just 0.1 per cent in the first half of its financial year, but improved margins and success in multichannel helped push profits up significantly.
For the 26-week period ending July 30th 2011, profits before tax totalled £7.3 million which was an improvement of 28 per cent compared to the same period last year and gross margins improved by one per cent.
Like-for-like (LFL) sales grew in all of Laura Ashley’s product categories barring home accessories, which witnessed a decline of one per cent, with furniture sales most improved with a year-on-year rise of 5.8 per cent.
Total UK sales fell by 1.1 per cent to to £120.1 million over the half but LFL they were up 3.5 per cent and online trading saw strong growth of 9.2 per cent compared to 2010.
Tan Sri Dr. K P Khoo, Chairman of Laura Ashley, said: “These are a set of pleasing results with a 28 per cent increase in profit before tax and exceptional items and a UK LFL sales growth of 3.5 per cent over the period in what has been a very unsettled time for the retail sector.
“I am delighted that, once again, Laura Ashley’s strong product offering, distinctive brand and continued focus on providing an attractive retail experience for customers have delivered another robust performance.”
Trading at Laura Ashley struggled in the first quarter of 2011 with total UK sales down 4.5 per cent, and so a much improved Q2, which has proved so difficult for many retailers is especially impressive.
It can boast a strong balance sheet with £32.1 million in cash, £100,000 down on the same point last year, and it has confirmed today a 100 per cent rise in interim dividend to one pence per share.
Dr. KP Khoo added: “These results show that our multichannel and international strategies are working well.
“These, along with our strong balance sheet and ongoing operational efficiencies, give me confidence, notwithstanding the continuing economic headwinds, that we will meet the board’s expectations for the year.”