Jacques Vert, the owner of fashion brands such as Planet and Precis, today became the latest retailer to warn on profits for its full year.
Following last week’s news that outdoor goods specialist and Millets parent firm Blacks Leisure expects profit before tax (PBT) to be lower than previously expected, Jacques Vert announced this morning that PBT for the current year will be down on earlier predictions.
The group attributed the downward forecast to a reduction in consumer confidence and unseasonably warm weather impacting sales, while structural changes to the business’ warehousing and IT systems are also significantly adding to costs.
Like many retailers, Jacques Vert has had to offer its customers a high percentage of discounted products in order to try and stimulate sales. Indeed, across the retail industry money-off deals have been commonplace throughout the summer and are sure to continue in the run-up to Christmas.
“At the AGM on September 30th 2011 the group reported an encouraging start to the new financial year, with like for like sales 0.2 per cent higher than the previous year in the 22 weeks since May 1st 2011,” said today’s statement.
“However, at the same time, we also noted a recent weakening trend in sales and margin in line with the general retail market.
“In the seven weeks since the AGM the group has continued to perform creditably, with a modest decline in sales over this period. Sales for the first 29 weeks of this financial year are 0.8 per cent ahead of last year and LFL sales are 0.3 per cent lower than last year.”
Work to improve Jacque Vert’s supply chain operations is expected to be completed by the end of April 2011, which will mark the end of the group’s 2011/12 fiscal period.
Today’s statement also indicated that despite margins being affected due to the group’s heavy promotional activity, the company’s balance sheet remains strong with positive cash.