Warren James founders share £30m dividend
THE brother and sister who run Stockport-based jewellery retailer Warren James have paid themselves a £30m dividend, TheBusinessDesk.com can reveal.
The payment to Ann Jones and John Coulter was made during the financial year to March 31, 2010 and is revealed in newly-filed accounts for the chain’s parent company. It shows a 15-fold rise in the dividend payment to £30m, from £2m a year earlier.
Turnover at the 120-strong store chain during the period dropped 10% to £43.6m (2009: £48.2m), leading to a 22% decline in pre-tax profits to £11.9m (£15.2m).
As a result of the dividend payout, the company’s net assets declined by the year end to £66.8m (£88.2m).
A directors’ report accompanying the accounts prepared by Ann Jones in her role as company secretary attributed the drop in sales to “general market conditions”.
“However, steps have been taken to address margins and costs to good effect,” it said.
It added that the current economic climate remained the biggest potential risk to the business moving forwards but said the firm remained confident about its prospects.
“The directors believe that the quality of our products and customer service will help mitigate the competition in the market and hope to see renewed growth and satisfactory trading results in the coming year.”
Recent research published by analysts Mintel shows that sales of precious metal jewellery have been virtually static over the past three years at just over £3bn as customers have reined in spending on big-ticket items.
More people have switched to silver jewellery as the price of gold has rocketed, and around 7% of consumers are estimated to have sold gold jewellery in return for cash.
Cheaper costume jewellery has also become more popular, with sales growing by 11% over a three-year period to £562m by the end of 2010.
“The affordability and disposability of many costume jewellery items means that customers are more willing to experiment and try new looks without denting their bank balances,” said Tamara Sender, a senior fashion analyst at Mintel.
“The soaring price of gold combined with the recession has led more and more consumers to trade in their old jewellery for cash. In response to demand, many high street jewellery chains have also set up a special service to buy second-hand jewellery.”
