Significant sales drop spooks investors

The share price of Birmingham-based Tandem Group closed down 12% after revealing sales were 30% lower than a year ago.

The company, which designs and makes bikes, toys and licensed products, blamed the drop on major retailers carrying forward stock from last year.

It has also suffered from the demise of Toys R Us, which had been one of its top five customers.

Chairman Mervyn Keene told Tandem Group’s annual general meeting: “Lengthy spells of cold weather and periods of heavy rain coupled with cautious national retailer buying and a lack of confidence in consumer spending was acutely reflected in toy industry data with a significant year to date decline in sales reported.”

“Both national retailer and independent dealer bicycle sales during the period were generally disappointing.”

The share price had dropped more than 20% in early trading to 115p before recovering to close at 127.5p. The fall handed back most of the gains achieved since March.