White Stuff prof­its halve af­ter triple cost hit

The Sunday Telegraph - Money & Business - - Business - By Ash­ley Arm­strong

PROF­ITS at White Stuff have more than halved af­ter the re­tailer, known for its quirky brightly coloured clothes, suf­fered a triple-whammy from ris­ing pen­sion, wage and cur­rency costs.

Although sales climbed 6pc to £153m, pre-tax prof­its tum­bled from £13m to £6m. In its lat­est ac­counts, the chain blamed “ex­ter­nal head­winds” for a tough year. White Stuff has also suf- fered from the fall in the pound.

The slump has made im­port­ing clothes from Asia al­most 15pc more ex­pen­sive than the year be­fore. It said: “Un­der­ly­ing sales growth has been dis­ap­point­ing, ex­ac­er­bated by a tough and un­cer­tain macroe­co­nomic en­vi­ron­ment, which has im­pacted con­sumer spend­ing and cre­ated a much more pro­mo­tion-led com­pet­i­tive en­vi­ron­ment.” White Stuff has made a num­ber of head of­fice re­dun­dan­cies, be­lieved to be 30 peo­ple, in or­der to rein in spend­ing in re­sponse to the sharp jump in costs. De­spite the un­cer­tain back­drop, White Stuff ploughed money into open­ing 32 new shops and con­ces­sions dur­ing the year, which eroded prof­its fur­ther. Sales were boosted by strong on­line growth with web sales lift­ing by 9.9pc to £42.3m, ac­count­ing for al­most 30pc of to­tal re­tail sales. The chain, cur­rently search­ing for a new boss af­ter Jeremy Sei­gal an­nounced he would leave by the end of the year, said that it had cho­sen to fo­cus its in­ter­na­tional ex­pan­sion in Ger­many and would there­fore also be clos­ing its two shops in Denmark.

The re­tailer said that be­cause of “chang­ing shop­ping habits” it would re­quire more in­vest­ment to de­liver a “mean­ing­ful ex­pe­ri­ence” for shop­pers.

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