Wilko’s bleak outlook as its profits dive 80%
PROFITS have plunged at high street retailer Wilko, which is blaming the weaker pound, higher costs and the National Living Wage for the fall.
Accounts just filed for the year ending January 28, 2017, show that pretax profits plummeted 80 per cent from £26million to just £5.2million, despite sales remaining steady at £1.5 billion.
And in a bleak outlook for business, the company warned of a ‘gloomy prognosis and severe economic headwinds’.
It said that in 2016, UK retailers were ‘buffeted by economic and geopolitical events beyond their control’, including George Osborne’s final Budget as Chancellor, which ‘surprised the nation by its unilateral imposition of a statutory minimum wage at well above expected levels’. It also blamed sterling’s decline due to Brexit and rising costs.
The directors noted that consumer confidence had remained high. But they added: ‘The impact [of sterling’s fall] on UK prices is widely expected to result in up to 5 per cent inflation during 2017.’