Mixed results for beleaguered fashion retailer Bonmarché

Sales were up in the third quarter for beleaguered fashion retailer Bonmarché as it entered the early stages of its turnaround plans.

The company, which has been struggling to maintain revenues and pre-tax profits as well as its share price since the departure of chief executive Beth Butterwick last year saw sales for the 13 weeks to December 24, 2016 up 3.3%.

Store like-for-like sales increased 0.8% in the same period.

But the bigger picture is looking less rosy for the company. Sales for the 39 weeks to December 24 decreased by 1.3%, with store like-for-likes decreasing 5.3%.

Chief executive Helen Connolly also lamented Bonmarché’s “poor” online sales.

In the update, the company said it still expects full year profit before tax to fall between the £500,000 and £700,000 range.

Helen Connolly, chief executive officer of Bonmarché, said: “Given the backdrop of the current trading environment, our third quarter store sales were satisfactory, particularly in light of the business still being in the early stages of its turnaround.

“The online performance was poor, and this continues to be a key area of focus.
Customers have responded well to the improved, more modern ranges in our core autumn/winter product categories of coats and knitwear. This was helped by more seasonally appropriate weather during the quarter, which strengthened demand and to some degree counterbalanced the weakness we are experiencing in the apparel market.

“The product gross margin for the quarter was 2.2% higher than for the corresponding period in FY16, due to a lower level of promotional activity than in the previous year. In particular, and for the first time in several years, the winter sale began in earnest on Boxing Day, rather than before Christmas.

“There remains a degree of uncertainty as to trading conditions as we enter our final quarter. Nevertheless, at the end of the third quarter, the Board’s view of the likely outcome for the full year remains in line with previous expectations.”

 

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