Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

Clothing retailer Bonmarche's shares dive after profit warning

Published 21/09/2016, 11:14
© Reuters.  Clothing retailer Bonmarche's shares dive after profit warning
MKS
-
DEB
-
BONB
-

LONDON (Reuters) - British women's clothing retailer Bonmarche (L:BONB) warned on profit on Wednesday as unseasonably hot September weather hit demand, hammering its stock price.

Shares in Bonmarche, which predominantly serves the 50 plus women's clothing market, fell up to 31 percent, taking its decline so far this year to more than 50 percent.

Analysts said the warning could have implications for the bigger players in Britain's clothing market, who have already endured unhelpful summer weather patterns, with June a washout.

Bonmarche said trading in September so far had been "extremely poor", largely as a consequence of hot weather which has not favoured sales of its new autumn ranges.

"The hot September has prevented us from gaining a representative measure of the strength of the autumn ranges, and our perception is that the clothing market generally has become more challenging," said the firm.

It forecast an 8 percent decline in underlying store sales for the second quarter and lowered its second-half profit expectations.

Bonmarche forecast a pretax profit for 2016-17 of 5-7 million pounds. Analysts at Investec were previously forecasting 12.5 million pounds.

"Attention now turns to whether Marks & Spencer (L:MKS) and Debenhams (L:DEB) will have to bring forward their planned updates on current trading," said independent retail analyst Nick Bubb.

Both M&S and Debenhams declined to comment.

M&S is due to publish half-year results on Nov. 8, while Debenhams is due to report full-year results on Oct. 27.

M&S' new boss Steve Rowe has pledged to turn around M&S's struggling clothing business by improving ranges and availability, cutting prices and offering fewer promotions.

However, his plan, outlined in May, came with a warning of a short-term dent to sales and profit and in July the 132-year-old group reported its worst quarterly clothing sales performance for a decade.

Shares in M&S, down 28 percent so far this year, were up 0.4 percent at 0932 GMT. Debenhams shares, down 23 percent in 2016, were flat.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.