Laura Ashley posts deeper loss after chaotic week

Laura Ashley posts deeper loss after chaotic week

Laura Ashley (LON:ALY) shares were trading over 4% lower on Friday after a rather chaotic week for the business.

The company unveiled its results for the first half of the year, posting a deeper loss before tax as a result of lower Home Furnishings sales and revenue disruption caused by a change in its Japanese Franchise partner.

This is not the first update from the company this week; on Tuesday it responded to media speculation concerning its current financial position, sending shares crashing.

Laura Ashley said earlier this week that current trading continued to be “challenging”.

Indeed, the British retailer almost collapsed just a few days ago, but it was able to agree on emergency funding with Wells Fargo.

For the 26 weeks to 31 December, Laura Ashley saw total group sales crash to £109.6 million from the £122.9 million figure recorded the year prior.

Total like-for-like retail sales dropped by 10.4%.

Meanwhile, loss before tax widened to £4 million, deeper than the £1.5 million seen in 2018.

Additionally, the company said that it is not recommending payment of an interim dividend.

“Over the past year there have been well documented market challenges facing the retail sector,” Chairman Andrew Khoo said in a company statement.

“Similarly at Laura Ashley, we have seen a combination of factors impact our results, ranging from higher costs largely driven by the Brexit uncertainty, minimum wages and business rates increases,” the Chairman continued.

Indeed, Laura Ashley is not the only British retailer to struggle for survival amid gloomy trading conditions to hit the high street. Economic uncertainty prevailed last year as the nation’s political landscape remained rather turbulent amid several extensions to the Brexit deadline.

The Chairman continued: “In the Autumn of 2019, we carried out a Strategic Review of the business to set the future direction of the company and return Laura Ashley to the great British brand that is known and cherished around the world. This review identified six areas of focus: improving our brand and customer strategy, accelerating digital, increasing store productivity, improving products and trading, growth opportunities, and focusing on our organisation and culture.”

The company said that it is “resolutely confident” in the future strength of the brand.

Shares in Laura Ashley Holdings plc (LON:ALY) were down on Friday, trading at -4.29% as of 10:58 GMT.