By James Davey
LONDON (Reuters) - British retail tycoon Philip Green's Arcadia fashion business has made a slow start to trading in the Christmas quarter, where sales have been held back by an unseasonably mild autumn.
Arcadia, which owns the Topshop, Topman, Dorothy Perkins, Wallis, Miss Selfridge, Evans and Burton brands, said on Wednesday that sales at UK stores open at least a year, inclusive of VAT sales tax, were down 2.3 percent year-on-year over the last 10 weeks.
"People (were) walking down the street in tee shirts in October and November," billionaire Green told Reuters.
But he said the group's inventory was "pretty much under control" and he was hopeful the "Black Friday" discount day this week would release some pent-up demand.
He said that the group had "double figures" sales growth in the UK last weekend when temperatures plummeted. "It's so sensitive, it's hard to read," he said.
Britons' spending power has benefited over the past year from a pick-up in earnings when inflation is hovering around zero and interest rates are still at record lows.
But in November, British retail sales grew at the slowest rate in nine months, according to a Confederation of British Industry survey on Tuesday, which partly reflected the impact of the mild weather.
Green, who has twice tried and failed to buy British clothing and food retailer Marks & Spencer (L:MKS), was speaking after Arcadia reported a 5 percent rise in 2014-2015 profit, helped by the international expansion of Topshop and the sale of the loss-making BHS chain.
The 2,358-store group made an operating profit before goodwill and exceptional items of 251.6 million pounds in the year to August 29, on flat sales of 2.07 billion pounds. UK like-for-like sales fell 0.9 percent.
The results are for continuing operations only and so benefit from the absence of the loss-making BHS business which Green offloaded to buyout firm Retail Acquisitions in March.
Topshop/Topman opened five wholly-owned new stores in the United States in the 2014-15 year, taking the total to nine. Some 34 new overseas franchise outlets for Topshop/Topman were also opened and 45 across the group's other brands.
Arcadia ended the year with cash of 229.1 million pounds.
But, for the 10th successive year, Green did not pay a dividend. In 2005, he took on additional debt and paid his Monaco-resident wife Tina, the ultimate owner of Arcadia, a 1.2 billion pound dividend.
Even after selling BHS, reportedly for just 1 pound, Green, who purchased Arcadia for 850 million pounds in 2002, said his asset buying days were not necessarily behind him.
"We've got good flexibility to do things ... If something turned up we thought that we have all the tools to do something with," he said. "We're in a very changing marketplace ... Let's see what turns up."
Green said a new clothing brand developed in a joint venture with singer Beyonce will launch in the spring.