Nick Hasell
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N Brown, the home shopping retailer which caters for fuller figured women, this morning defied the gloom of its High Street rivals with above-forecast sales figures and confirmation that it would meet full-year profit targets.
The Manchester-based group - half of whose customers are size 20 and over - reported a 14 per cent jump in like-for-like sales in the 20 weeks to January 12, an acceleration on the 11.1 per cent reported at its half-year results in October.
Shares in N Brown rose 25.5p to 233.75p, or 12 per cent, the best rise in the FTSE 250 in early dealings. The shares had fallen 40 per cent since May on concerns of weaker consumer spending.
That performance confirmed the trend for retailers with a significant online presence to outperform their peers over the Christmas trading period. Growth in Internet sales has picked up from 40 per cent to 48 per cent, such that online orders now account for 28 per cent of the total.
N Brown said the sales growth had come across all of its product ranges, including a strong performance from ladies clothing, and was achieved depsite the impact of last October’s postal strike.
“Sales from our established customers have been ahead of our expectations due to higher response rates and an increase in average spend, driven by improvements in our product ranges, catalogues and website”, the company said in a statement.
However, gross margins in the period were 0.5 per cent down on last year, in line with forecasts.
N Brown will make £71.3 million of pre-tax profits in the 12 momnths to February 29, according to consensus forecasts, a 12 per cent rise on the previous year.
The catalogue retailer also reported that sales from new customers in the second half were up 30 per cent.
Andrew Wade, retail analyst at Seymour Pierce said: “We suspect that, with sales running ahead of expectations, the business has upped its advertising spend to drive customer recruitment. This should position it well going forwards. In all, this was a positive update and a strong trading performance even for one of the home shopping players”.
Jose Marco-Tobares, retail analyst at Numis Securities, who had forecast an 11 per cent rise in like-for-like sales, said: ”This performance is particularly encouraging as the comparative has become tougher”.
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