Monthly Archives: August 2012
Massmart plans to revamp 10 of its 17 Makro stores, which would thereafter offer fresh produce, butchery items and new brands.
The chief executive of Makro stores, Kevin Vyvyan-Day, said yesterday that the new stores would be more shopper and environmentally friendly and would allow consumers to buy single items as well as bulk packs.
“We already have a personal care section and fresh produce and a butchery section where customers can get fresh meat,” he said.
Vyvyan-Day said although Makro sourced most of its supplies locally, the retailer did have a few new brands. These included private label Great Value batteries and Buddez iced tea, which is made in the US and sold at Walmart’s smaller-format Club warehouse stores.
Abdul Davids, the head of research at Kagiso Asset Management, said the benefits of being part of Walmart included the US chain’s global procurement capability and its private label branded goods. The continuing trend of sourcing these goods would not affect local suppliers, but would expand the available product range.
Walmart acquired control of Massmart last year and a Competition Appeal Court ruling on its supplier development fund is awaited.
Vyvyan-Day said the new generation Makro stores would still have a warehouse look, but skylights would let in natural light and save energy.
“Heat from [the] regeneration plant is reclaimed and used to heat water, which is then used to heat the building in winter.”
A Makro will be opened in Bloemfontein by year end.
Massmart, which has 348 stores in total, generated a 38 percent increase in retail sales to R61.2 billion for the year to June. Makro stores contributed about R15.3bn to group retail sales. This meant each Makro store generated about R1bn annually.
At yesterday’s opening of the Cape Gate Makro in Cape Town, customers bought 1 100 television sets.
Vyvyan-Day said the Cape Gate outlet was designed to look like an office block.
Makro stores are generally built in non-residential areas, but the Cape Gate store is near a residential suburb and next to a mall housing Checkers and Pick n Pay stores.
The 16 000m2 store trades more than 55 000 brands sourced locally and internationally and has created about 450 permanent jobs.
US restaurant chain Russo’s New York Pizzeria has announced that it will open three outlets in the UAE this year.
The firm will open restaurants in Dubai, Abu Dhabi and Sharjah in autumn after awarding territory rights to Dubai-based Prime Hospitality, a division of Ghobash Trading & Investment Company.
The first outlet at Dubai’s Jumeirah Centre is pencilled in for a late October opening, followed by an Abu Dhabi restaurant in November at the newly renovated Al Wahda Mall. Russo’s Sharjah eatery will be based at the Sahara Mall.
Russo’s says it is also looking to bring its up-market concept, Russo’s Coal Fired Italian Kitchen, to Dubai in 2013, despite not yet having secured a location.
“We have looked at a number of locations and found that landlords are happy to have us, however it is not a matter of opening as soon as we can, it’s a matter of finding the right locations,” said Murad Alnasur, general manager at Prime Hospitality.
Founded in 1992, Russo’s currently has 25 locations across the US.
Men’s apparel and accessories retailer JoS A Bank Clothiers Inc’s quarterly results handily beat Wall Street estimates as customers flocked to buy its products on the Internet and through catalogs.
Sales in the company’s direct marketing segment, which consists of the Internet and catalog call centers, rose 39.3 percent in the quarter.
As of fiscal 2011 the direct marketing segment accounted for about 10 percent of total sales.
JoS A Bank, which sells men’s tailored suits and shirts, said the third quarter started out positively and the company plans to open about 45 to 50 stores each in fiscal 2012 and 2013.
Earnings rose to $23.2 million, or 83 cents a share, in the second quarter from $20.6 million, or 74 cents a share, a year earlier.
Sales rose 12.9 percent to $260.3 million. Comparable store sales increased 6.1 percent.
Analysts on average were expecting the company to post earnings of 73 cents on a revenue of $251.1 million, according to Thomson Reuters I/B/E/S.
JoS A Bank shares closed at $41.63 on Tuesday on the Nasdaq.
NEW YORK — J. Crew Group Inc. is running strong and bringing its business to new markets.
“It’s been a nice year so far,” Millard “Mickey” Drexler, chairman and chief executive officer, told Zee. “Every day we get a bit smarter about our business, but you can never let your guard down.”
On Wednesday, the company reported a robust second quarter, marked by a return to the black and strong sales and full-price selling across several categories. Executives also cited plans to add more men’s wear stores this year, and divulged the time frame for opening the first J. Crew stores in Europe and Asia, meaning the company is getting close to signing leases. A London store is seen opening in the second half of 2013, and a store in Hong Kong is seen opening in the first half of 2014.
Last year, J. Crew crossed borders for the first time by launching international shipping, partnering with Net-a-porter, and opening a store in the Yorkdale Shopping Centre in Toronto, marking the first brick-and-mortar move in its international expansion plan. Last March J. Crew expanded its international shipping to 107 countries, up from 29, and more recently revealed a plan to distribute to Lane Crawford in Asia.
J. Crew reported net income of $22 million for the second quarter ended July 28, compared with a $10.5 million loss in the year-ago period. Last year’s loss was due to nonrecurring inventory and litigation costs associated with its acquisition by TPG Capital L.P. and Leonard Green & Partners L.P. in March 2011. In the 2011 period, the amortization of inventory from purchase accounting cost the company $22 million, and litigation costs reached $6.5 million.
Total revenues in the latest quarter rose 21 percent to $525.5 million, while comparable company sales increased 14 percent. Gross margin increased to 45.1 percent from 36.5 percent, reflecting healthy full-price selling.
Operating income increased to $62.1 million, compared with $12.3 million in the second quarter of 2011.
Men’s wear, according to the company, increased at a higher rate than women’s last quarter, and executives cited plans to open two more units this year, including a Ludlow shop in Copley Place in Boston on Sept. 18, and a J. Crew men’s shop in The Grove in Los Angeles on Nov. 21, bringing the total to nine men’s units. J. Crew men’s wear, Drexler said, has become “quite well known as a strong franchise. Our Ludlow suit business is a business unto itself, as is our shirt business.” Ludlow is a J. Crew label.
Barnes & Noble announced three more partners for its Nook UK launch this fall: Academic bookseller Blackwell’s, independent bookseller Foyles and general retail chain Argos. B&N also announced John Lewis as a retail partner earlier this week.
Barnes & Noble is preparing to launch its Nook e-readers (but not the Nook Tablet or Nook Color) in the UK this October, and announced its first retail partner there — department store John Lewis — earlier this week. Now add Argos, Blackwell’s and Foyles to the list for a total of 800 UK stores selling the Nook.
Foyles is an independent bookstore chain with six stores in London and Bristol. “Barnes & Noble’s NOOK was born in and developed by a bookshop, so it is the ideal digital reading device to be sold by one,” said Foyles CEO Sam Husain said. Meanwhile, academic bookseller Blackwell’s will sell Nooks at its 55 college shops and other stores.
Argos is a large general retailer with 700 stores in the UK and Ireland. It already sells Kindle, Kobo and Sony e-readers. Amazon also sells the Kindle at Waterstones, the UK’s largest bookstore chain, John Lewis, Tesco and other UK retailers.
Date 29 August 2012 : InventCommerce and Google have confirmed that Mary Portas, one of the UK’s foremost authorities on retail and brand recognition, is to present at the Google Commerce Search evening. This exclusive event for retailers will be held on 12th September at Google’s UK Headquarters, London.
The event will be attended by leading retailers that are currently investing heavily in ecommerce and online strategies, yet cognisant of how the online and offline retail worlds are converging. Senior retailer executives will have the opportunity to spend an evening with their peers and listen to informative and inspirational talks from both Mary Portas “queen of shops” and Peter Fitzgerald, Director of Retail, Google UK, plus discover more about Google Commerce Search and learn how brands and retailers are leveraging this service to engage users and drive conversion in both the online and offline world.
Kevin Ludford, CEO of InventCommerce, said:
“We are thrilled to have Mary Portas, the “queen of shops” speaking the event in September. Mary recognises the significance of ecommerce in retail strategy and will be sharing her thoughts.” He added, “Accompanied by Peter Fitzgerald, Director of Retail for Google UK, who is such an informative authority on retail and a fantastic presenter, this is sure to be a truly inspiring and insightful evening.”
The seminar will be held on 12th September at Google HQ in London. Registration is strictly open to retailers only. There are a handful of places left, if you would like to submit a registration, go to http://www.googleretailevent.com but please do not be disappointed as the final places will be allocated to retailers on a first come, first serve basis.
InventCommerce Ltd is a London based specialist eCommerce solutions business delivering innovative eCommerce solutions for retailers. We are dedicated to delivering Demandware and Magento eCommerce platforms and support retailers across eCommerce strategy, platform development and deployment to supports clients with global trading ecommerce solutions. We are also Google’s UK Go-To-market partner for the Google Commerce Search solution and have a core expertise in new retail concepts, omni-channel, international expansion and have been heavily involved in developing Private, Flash Sales and Mobile ecommerce solutions. http://www.inventcommerce.com
(Reuters) – Debt-mired JJB Sports put itself up for sale on Thursday and warned investors their shares may be worthless, placing the sports goods retailer at risk of becoming another big-name British retail casualty.
The company has been rocked by funding issues, falling sales and stiff competition as UK store chains battle weak consumer spending, muted wage growth and government austerity measures.
A string of household retail names including Woolworths and MFI have gone out of business in recent years, undermined by price-cutting from supermarkets and the Internet.
Directors at JJB, a familiar sight on Britain’s high streets with around 4,000 staff and 180 stores, said they did not believe the company would be able to raise new funds to stage a turnaround.
Analysts said the sale process was not a surprise given the funding shortfall issues flagged by the company in July and its failed attempts to raise fresh cash from strategic partners.
JJB said that a formal sale process would start but warned that there could be no certainty that an offer could be forthcoming.
“Given the level of current debt within the company, there can be no assurance that any proposal or offer that may be made would attribute value to the ordinary shares of the company,” the company said in a statement on Thursday.
Shares in the company crashed 71 percent to 0.68 pence at 0840 GMT, giving it a market value of around 3 million pounds. It was worth 500 million pounds in August 2010.
“We suspect that JJB will now follow a similar process as Blacks Leisure i.e. a likely administration process followed by the possible sale of parts of its business,” said analysts at Charles Stanley.
Blacks Leisure, which like JJB was loss-making and debt-saddled, went into administration in January before the bulk of the business was sold immediately to JJB’s rival JD Sports Fashion.
When retailers are bought out of administration, the buyer usually cherry-picks certain operations, which can lead to store closures and job losses.
U.S. retailer Dick’s Sporting Goods threw JJB a 20 million pounds lifeline in April, but took an impairment charge that effectively wrote off the investment earlier this month.
JJB, which issued a profit warning in July on the back of poor sales of Euro 2012 football shirts and reported an 8.7 percent slump in first half underlying sales, said organic sales in the six weeks to August 26 slipped 3.3 percent.
“It’s a business that’s been shrinking for the last couple of years,” Seymour Pierce analyst Kate Calvert said.
“They haven’t been able to find their niche in the market place and be able to take on the likes of Sports Direct and online and supermarkets.”
Larger rival Sports Direct – Britain’s biggest sporting goods retailer – owned by Newcastle United football club owner Mike Ashley, has consistently undercut JJB on pricing and aggressively discounted Euro 2012 kit.
JJB Sports was founded in 1971 by ex-Blackburn Rovers footballer Dave Whelan with a single store in Wigan, where the company is still headquartered.
It floated in 1994, and four years later acquired the business of Sports Division, making it Britain’s biggest sports retailer at the time.
JJB owes around 36 million pounds ($57 million) in total, around half in bank debt and the other half in convertible loan notes, giving it a debt to equity ratio of 0.51, far higher than rival JD Sports which is on 0.01.
A multi-million pound package of support for towns and cities not selected by the government as one of the 27 Portas Pilots will begin being delivered by the Association of Town Centre Management next month.
This next phase of the government’s initiative will start on 5 September with a meeting in London organised by the ATCM and the Centre for Local Economic Strategies. The meeting will feature information on the full package of support, worth up to £5.5 million, and aims to build on the momentum started by the Portas Review by creating a community-led movement to develop high streets of the future that do not solely rely on retail.
The association is inviting all 392 towns where their MPs have agreed to back their town teams, as well as existing town and business improvement district managers who can provide insights into how to professionally manage town centres and high streets.
The ATCM said the event will be followed up with action across the country leading to a two-day “World Cafe of Ideas” this October in Birmingham, as well as a series of meetings in each of the English regions. In addition, mentors and other experts will engage on an on-going basis with each of the Town Teams which participate.
Wilkinson is to cut staff hours at up to 80 of its stores as it attempts to reduce costs in under-performing branches.
The high street discount chain has asked staff at around 80 of its 370 stores to take a voluntary cut in hours. The average reduction per store could be up to 80 hours a week although the number of stores affected might be reduced once figures are finalised.
A spokesman told The Grocer magazine: “In spite of the company’s exceptional value offering, determination to open new stores and further enhance the shopping experience through our innovative store in Crawley, some existing Wilkinson stores are not immune.
“Importantly, the business is trying to achieve flexible ways of resolving such performance issues by asking team members to help find flexible solutions that fit their own needs as well as those of the business.”
Earlier this month Wilkinson revealed that pre-tax profits had fallen from £60.8 million to £22.7 million in the year to 27 January, as the retailer ploughed £44 million back into the business with the opening of new stores and investment in its online operations.
Retailer’s online solutions managing director to take on her new role from early next month, replacing Anthony Hemmerdinger
Carphone Warehouse has appointed Sam Tyrer as its new UK retail director. She replaces Anthony Hemmerdinger, who left the retailer last month after 18 months in the role.
Tyrer will take up her new position early in September, with accountability for retail, business operations, contact centres and direct sales.
She joined Carphone in November 2007 as its customer and stores director for the London territory, before becoming managing director of online solutions in February 2010.
Prior to joining Carphone, Tyrer worked for entertainment retailer HMV for 16 years as its divisional manager for the south and Ireland.
Carphone Warehouse UK and Ireland managing director Matt Stringer said: “Sam is an experienced retailer with a sharp sense of commerciality. She possesses an admirable empathetic and collaborative management style. She is a tenacious operator, who has delivered some impressive and difficult changes in recent times such as the move of Mobiles.co.uk to Loughborough.”
Tyrer added: “I am delighted to have been appointed to the role of retail director and am genuinely excited and looking forward to working with my talented teams to ensure that Carphone Warehouse gives every one of our Customers the very best possible experience.”
Boots has launched its new healthy and convenient food offer in stores today, in partnership with Irish food retail giant Musgrave. The range includes meat, fish and ready meals as well as in-store delis.
Eleven of the health and beauty retailer’s across England will carry food, including lines from Musgrave’s SuperValu range which is also sold in Budgens and at eponymous stores in Ireland. The price points of SuperValu ready meals start at £2.00.
Boots will also offer food products from the Kirstys range and will sell alcohol.
Retail Week revealed in May that Boots planned to introduce a meal range in September.
The new convenience offer focuses on ‘food to go’, ‘food for later that night’ and ‘fresh top up’.
Two formats – the mini and maxi – will be introduced across the stores in an initial 12 month trial.
Stores in Fort Dunlop, Warrington, York, Swindon, Colchester and Chapelfield Norwich will operate the mini format where customers will be able to buy ready meals, fruit and veg, salad, desserts, tea and coffee and bakery goods. The mini format will launch in London stores St Pancras and Green Park in October.
The maxi format will sell the same range, with an additional offer of meat, fish, breakfast and a deli, dairy goods and store cupboard essentials. Stores in Manchester, Woking and Watford will offer this format.
It is a much more vaired food offering than Boots, which is owned by pharmaceutical giant Alliance Boots, has ever had before. Boots has previously experimented with extending its food offer with Waitrose but this ended earlier this year after it failed to meet both retailers’ expectations.
Alliance Boots health and beauty chief executive Alex Gourlay said of the new food offer: “We are very pleased to be partnering with Musgrave on this trial. It builds on our own extended food offer of Shapers and Delicious whilst exploring how we can deliver even greater choice and convenience for our customers through a broader food offering.”
Alliance Boots and US drugstore giant Walgreens revealed plans for a merger of the two companies in June. Walgreens already has an extensive food offer in its stores across the US.
H&M has announced its first step into South America by opening a flagship store in Santiago de Chile, Chile.
The store will be a full-concept flagship store at the “best business location” at the shopping mall Costanera Center, and is planned to open during the first half of 2013.
Karl-Johan Persson, CEO at H&M, commented: “We are very excited to announce the opening of the first H&M store in South America, in Santiago de Chile, Chile. It is our first step into the southern hemisphere, and we see great potential for further expansion in this fashion conscious region. We look forward to bringing fashion and quality at the best price to the Chilean customers.”
JC Penney CEO Ron Johnson gives an early look inside the latest brand Shops emerging Sept. 1 in nearly 700 stores nationwide. The Company will debut brand Shops for Liz Claiborne®, IZOD® and jcp™ – a new jcpenney exclusive brand dedicated to high-quality fashion basics. These new fall shops will add to its existing portfolio of Shops inside jcpenney, which include Levi’s®, The Original Arizona Jean Co., i jeans by Buffalo™, MNG by Mango® and Sephora®. Over the next few years, jcpenney stores will transform its sales floor into a dynamic collection of 100 Shops showcasing major apparel and home brands for every style and budget. jcpenney is on an exciting journey to build the first specialty department store of its kind by creating an unforgettable retail experience that will forever change the way America shops.
BMW Motorcycles is revving up Bloomingdale’s Fall fashion campaign. The BMW R 1200 R Classic is featured in the men’s department at Bloomingdale’s stores nationwide, inside the fall men’s catalog, and in the store windows of Bloomingdale’s flagship store on 59th St. in Manhattan, NY. And that’s not all! Shoppers will also have the opportunity to win their very own bike – both in-store and on http://www.bloomingdales.com.
“Partnering with Bloomingdale’s is a natural extension of the BMW brand as both a cultural and product icon,” observed James Callahan, Marketing Communications Manager, BMW Motorrad USA. “For decades, our bikes have been featured in films, music videos, magazine photo shoots and special events. From James Bond to “Jay Leno’s Garage” and the recent Summer Olympics, BMW motorcycles are seen and ridden ’round the globe.”
Bloomingdale’s new “On the Road” shops for guys on-the-go celebrate the “moto trend” with cool travel essentials like leather fingerless gloves, hooded knits, leather totes, cool tees, and the opportunity to check out the BMW R 1200 R Classic in person.
According to Mr. Callahan, the in-store motorcycle displays in Bloomingdale’s men’s departments are turning more than a few heads. “An R 1200 R was sold the very first day it appeared in the Tyson’s Corner, VA Bloomingdale’s store,” he reported.
Sir…Would you like the bike giftwrapped with the belt?
Amazon has launched an Amazon Local daily deals website in the UK, pitting it head-to-head with established players such as Groupon.
The deals site offers shoppers bargains on local services, products, and experiences such as hot air ballooning nearby. At present the service is only being offered to shoppers in London through a dedicated site; local.amazon.co.uk.
Amazon has emailed customers in the capital with deals including flying lessons, yoga sessions and money off baked goods.
Customers can receive deals tailored to their preferences and the service uses customer payment details already stored on Amazon.co.uk’s main site.
Amazon launched the service in the US last year where it is available in 32 states.
In 2010 the etail giant invested $175m in a stake in deals website LivingSocial. It is unclear what the relationship is, if any, between LivingSocial and the launch of Amazon Local.
The launch is likely to spark interest from retailers in the UK keen to drive footfall through the deals, which offer shoppers significantly discounted products and services.
However, some rival sites have got into hot water. Groupon, which went public last November, was investigated by the OFT this year for exaggerating its discounts.
Gordon Willoughby, Amazon Local director for Amazon EU, said: “Our aim is to be the place where customers can come to find anything that they want buy online, so offering great deals from local businesses like restaurants, spas and theatres is a logical addition to the tens of millions of products that can already be found at Amazon. This is day one for AmazonLocal.co.uk and we will focus our efforts on providing a first rate customer experience for Londoners.”
The company said Amazon.co.uk MasterCard customers can accumulate loyalty points for purchases on AmazonLocal.co.uk. These points are converted to gift certificates and can be redeemed against products on the Amazon.co.uk website. For purchases on AmazonLocal.co.uk, the cardholder will receive two Loyalty Points for every £1 they spend.
Victoria’s Secret opened the doors of its London flagship store on Bond Street today.
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The 40,386 sq ft shop, which the retailer views as a global statement store, has three trading floors and a VIP lounge area.
The US giant Victoria’s Secret, owned by Limited Brands, said the store’s design embodies the brand’s “sexy, sophisticated and glamorous spirit with a nod to the old English heritage of New Bond Street.”
The store design is more refined than its Westfield Stratford City shop which made its debut last month, and which will be the UK roll-out model.
Design elements at the Bond Street flagship include carved mouldings, elaborate decorative painting and glass chandeliers.
A giant two-storey video screen playing footage from Victoria’s Secret fashion shows takes centre stage in the store.
The lower ground floor carries Victoria’s Secret’s Pink collection, a “collegiate-inspired” range of bras, underwear and loungewear.
The ground floor comprises the main collection and beauty offer, including fragrances, lipgloss and moisturising creams. The first floor houses sexier ranges and a second floor leads to the Angel Suite, an invitation–only area for VIP customers with private fitting rooms.
To coincide with the opening, the retailer launched a Victoria’s Secret London perfume and a range of underwear for the London stores such as knickers with Union flag charms attached to them.
Marks & Spencer opened its 151,000 sq ft store at Cheshire Oaks on Wednesday morning, promising a ‘new retail experience for customers’.
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The store is the second largest M&S in the country – London’s Oxford Street store is bigger – and will employ 500 people. Features include free wi-fi, ‘browse and order’ screens and the largest home interiors department in the group’s UK portfolio, at 18,000 sq ft. The womenswear department stretches to 30,000 sq ft and there are 7,000 product lines in the food hall. There are two cafes with seating for 430 people.
Plans for the store were criticised by some Cheshire residents who saw it as a threat to Chester city centre’s retail appeal. Chester City Council and Cheshire County Council both opposed the plans but many of the same politicians who opposed it later backed the store after the enlarged Cheshire West & Chester Council was created and Ellesmere Port and Chester became part of the same authority. Former Communities Secretary John Denham ruled in favour of the store following an inquiry in 2009.
Steve Rowe, M&S director of retail, said today: “In line with our strategy to develop an exciting, easy to shop retail experience for our customers, our Cheshire Oaks store will encapsulate the latest & very best of M&S design and cutting-edge retail technology.
“Here at our brand new flagship store, our customers will find a fresh approach to shopping and customers service, enhanced by interactive technology that creates a truly unique consumer environment. This store represents the future of retail – a dynamic, interactive space that will redefine what it is like to shop at M&S.”
Cheshire Oaks’ is the greenest store M&S has built and uses carbon-absorbing hemp wall panels, rainwater harvesting and sustainable timber in the roof and first floor.
L’Oreal SA (OR), the world’s largest cosmetics maker, reported an 11 percent increase in first-half profit as sales gained in Africa and Asia, and said it still expects revenue to grow faster than the market in 2012.
Operating income rose to 1.9 billion euros ($2.4 billion), the Paris-based company said today in a statement after the stock market closed. The average of four analysts’ estimates compiled by Bloomberg was 1.92 billion euros.
The maker of Body Shop hemp hand-cream confirmed its target of outperforming the global cosmetics market, which it has estimated will grow about 4 percent this year. Like-for-like sales should increase 5.6 percent in 2012, according to Andrew Wood, an analyst at Sanford C. Bernstein.
“This performance reflects the group’s ability to build solid and profitable growth,” L’Oreal Chairman and Chief Executive Officer Jean-Paul Agon said in today’s statement.
L’Oreal fell 0.2 percent to 101 euros at the close of trading in Paris. The stock has gained 25 percent this year, giving the company a market value of 61.3 billion euros.
Net income increased 10 percent to 1.66 billion euros. Allowing for non-recurring items, net profit after controlling interests reached 1.63 billion euros, up 11 percent.
The global cosmetics market is growing at an annual rate exceeding 4 percent, L’Oreal’s director of financial communications, Thierry Prevot, said on a call with reporters.
The first-half operating margin widened to 16.9 percent of sales from 16.2 percent at the end of 2011 as L’Oreal reduced the amount it spent on advertising, promotions, selling, administration and other activities relative to revenue.
Gross profit as a percentage of sales narrowed to 71 percent from 71.2 percent at the end of 2011. L’Oreal attributed the decline to the weakening of the euro, the consolidation of Clarisonic, a maker of sonic skincare devices that it agreed to buy at the end of 2011, and an increase in promotional offers.
L’Oreal also said it will buy back as much as 500 million euros of shares by the end of the year that it will then cancel.
Monday, Aug 27, 2012
Dubai: Ikea has announced that it will offer zero per cent interest to customers making purchases of Dh500 and above at its Dubai Festival City and Yas Island stores.
The Al-Futtaim Group has partnered with Emirates NBD to launch this finance service. Under the terms of this agreement Ikea will offer from Monday, three, six and 12 month interest free services only to Emirates NBD credit cardholders for furniture and furnishings including kitchens, bedrooms, and living-rooms.
For non Emirates NBD customers there is a possibility to apply for a card in Ikea stores through the bank’s kiosk. This offer is only available to UAE residents.
An expansive retail, leisure and entertainment centre is being built as the centrepiece of Jumeirah Beach Residence (JBR), a development of 40 towers running along the Dubai seafront.
In a move that will completely change the face of JBR Walk, one of Dubai’s most popular leisure attractions and walkways, Meraas Holding is set to construct a mall of shops and restaurants that will run for nearly 1km along the beach from The Hilton Hotel at one end to the Sheraton Hotel at the other.
“The project involves the creation of an integrated retail and leisure area with underground parking facilities meant to upgrade and develop the beachside area, in front of Rimal and Amwaj sectors,” said a spokesman at Dubai Properties Group (DPG), the owner of JBR.
“The new development will offer visitors and residents an even wider variety of shopping, dining and retail destinations, upholding JBR’s status as one of the GCC’s top tourist attractions.”
Meraas Holding would not disclose any specific information about the project but Benoy Architects, which designed Ferrari World Abu Dhabi and Sowwah Square, is thought to be the lead architect.
DPG said development activity had already started and would be completed in “less than” 18 months. It also confirmed the project would be low-rise and would not impinge on the views of JBR residents.
“The new development has been planned so as to ensure that sea views will not be blocked for any residents within the community,” said the DPG spokesperson.
Analysts said the Meraas development at JBR could be a success, given the area’s current focus on food outlets rather than retail stores.
“JBR Walk doesn’t necessarily provide adequate retail provision and is very food-outlet biased, so this will go towards that balance and hopefully it can add to the experience of the Marina rather then hinder it,” said Richard Paul, a director at Cluttons, a property specialist.
“In the long run as the tram system completes and the traffic problem alleviates, I imagine it can only bring positives.”
Throughout the UAE, major companies are investing heavily in retail and leisure developments.
Nakheel is one of the biggest investors in the sector as it looks to borrow Dh300 million (US$81.6m) from banks to build a shopping, restaurant and marina complex called The Pointe, on the tip of the Palm Jumeirah.
It is also doubling the size of Dragon Mart and considering doing the same for Ibn Battuta Mall, as well as constructing a mall on the Palm Jumeirah.
Emaar is expanding the size of Dubai Mall by 92,000 square metres and Meraas is also developing The Avenue, a retail strip in the heart of Dubai.
In Abu Dhabi, a total of 260,000 sq metres of retail space is expected to be completed this year on top of 1.67 million sq metres currently available in the capital, according to the property consultancy Jones Lang LaSalle.
Developers are set to hand over three malls in Abu Dhabi: Paragon Bay Mall on Reem Island; Capital Mall in Mohammed Bin Zayed City; and Deerfields Townsquare in Al Bahia.
There are also new smaller developments such as Etihad Towers, Galleria at Sowwah Square and Emporium at Central Market all forecast to open in the next couple of years.
Originally designed to be a major retail shopping area, The Walk at JBR was unsuccessful in its early years for many retailers and many eventually shut up shop. Virgin Megastore was one of the last to close its shop on the plaza level of JBR this year.
JBR residents have been sent information on the Meraas project in a letter outlining the construction plans.
“During the construction phase, Meraas has put plans in place to minimise inconvenience to the community and include additional temporary parking as well as traffic management,” DPG said.
“Residents and visitors will continue to have access to the beach through pedestrian crossings adjacent to the car park. We are also looking at strengthening the police presence at The Walk to assist pedestrians and to better manage the traffic.”
The arrival of digital money on Britain’s high street has been anticipated for some time, and this year its potential is finally being realised with PayPal in store. Launched in May 2012 at Oasis and other major retail brands, the new system uses a mobile phone app that allows customers to pay via PayPal on the high street, bringing the flexibility of online shopping to the high street for the first time.
Far from being a payment solution of the distant future, m-commerce has arrived. PayPal estimates it will handle $10bn of mobile payments in 2012, up from $4bn last year. After all, consumers are using mobile phones for a huge variety of tasks, from social media to streaming content, so it’s not surprising that mobile payments are also taking off.
PayPal wants to create a great shopping experience whether you’re on the sofa at home browsing the internet or visiting your local shop. Bringing PayPal to the high street is a natural move, building on our experience making it easier and safer to pay online over the past decade. We predict that by 2016 consumers won’t need a wallet to shop on the UK high street – a mobile will be enough.
PayPal PoS Trade Show Final Cut from Newspepper on Vimeo.
So how does PayPal work in store? Customers simply download the app and register it to their PayPal account. After setting up a PIN number, used to log in to the app each time for added security, customers use a unique barcode (generated by the app) for each transaction, with no personal information or money stored on the phone. Payments, refunds and discounts are all managed through the same secure app.
The strength of PayPal’s in store service lies in its simplicity. Unlike NFC (near field communication) technology, which needs new hardware installed at every till, PayPal in-store works seamlessly with existing high street retail infrastructure. We’re not asking retailers to completely change their point of sale systems, or demanding that customers buy a new mobile phone. Instead, we’re working in partnership with retailers, using their existing barcode and scanner system to make paying by mobile very simple.
The way we shop is about to change dramatically. The store of the future will look very different, with less emphasis on counter-based tills and more focus on portable sales points, using tablets and mobile devices (expect to be able to pay for clothes in the changing room!). At PayPal, we’re not interested in technology for technology’s sake; we’re trying to help retailers use technology to give an even better experience to their customers.
The mobile phone has changed our lives. It’s about to help transform the way we shop on the high street.
Danish-owned menswear retailer Jack & Jones is continuing its UK expansion with the opening of four new stores in both high street and shopping centre locations in Exeter, Carlisle, Swansea and Cwmbran.
Launched in 1989, Jack & Jones, which is part of Bestseller, the family-owned clothing company, is now sold in approximately 2,000 retail shops across Europe, of which 270 are franchises. As part of plans to grow the business, the retailer has retained commercial real estate firm CBRE to find suitable premises in Scotland, and to assist with requirements in the north of England.
The biggest of the four new stores to open is in Carlisle, where the menswear and denim retailer has acquired a 3,050 square foot store in The Lanes Shopping Centre. The store, which spans across two floors, joins 75 leading brands including Debenhams and Next.
Kevin Simms, Retail Director, CBRE, said: “Since launching in 1989, Jack & Jones has seen a meteoric rise across Europe and has quickly grown to become a successful global fashion brand. The retailer has also seen considerable success in the UK and is currently well positioned to grow the business further.
Following the opening of these most recent stores it is anticipated expansion will continue throughout the UK in strong regional high streets and shopping centres.”
A UAE-based businessman has commissioned the Ferrari special projects team to build him a one-of-its-kind car.
The special-edition Ferrari 599 GTO – called the Ferrari SP Arya – is being built for Cheerag Arya, the CEO of JBF, a petrochemicals company based in Ras Al Khaimah at its Maranello factory in Italy.
It will be the fifth car to leave the special projects factory following the SP1, the P540 Superfast Aperta, Eric Clapton’s SP12 EPC and the Ferrari Superamerica 45, magazine GTSpirit reported.
According to reports, Arya’s other cars of choice include a 599 GTO, a Daytona, an F40, a 599XX and an SA Aperta.
In comments published by the magazine, Arya said: “I told the designers what I wanted and they presented me with a total of 12 designs.
“I then picked the bits from each that I liked until we got an idea of the car I had in mind. A bit like a wish list.”
He did not reveal the pricetag for the exclusive car or when he was picking it up from the factory.
The FTSE 100 retailer is trialling the technology in its new state-of-the-art store at Cheshire Oaks, near Liverpool, which will be officially opened by chief executive Marc Bolland tomorrow.
M&S hopes customers will use the wi-fi to browse the company’s full range of stock on their smartphones and buy products they see in the store. The iPads will provide customer assistants with more information to help shoppers.
The technology drive is being led by Laura Wade-Grey, the former Tesco executive who runs M&S’s e-commerce and multi-channel divisions.
The company is investing £100m on new technology and £150m on a new model, or platform, for its website that will be ready by 2014.
In addition, Mr Bolland has committed £500m to opening new stores, including Cheshire Oaks, which at 150,000 sq ft will be the second biggest M&S store in Britain after Marble Arch, in London.
Ms Wade-Grey said M&S is investing more than other UK retailers in technology, including Tesco.
M&S hopes the opening of the Cheshire Oaks shop will boost the company after a sluggish run for its shares on the stock market and a disappointing trading update in July.
The store includes revamped home and beauty sections as well as other new technology such as big screens promoting clothing, and interactive screens allowing customers to browse stock and make orders.
Ms Wade-Grey said the “hospitality offer” in M&S stores is an “important part of the business”.
Mr Bolland has set a target of £800m to £1bn of e-commerce sales by 2014. M&S already sells roughly one in three dresses and 20pc of its suits online, while school-wear has become one of the company’s most popular smartphone products as families seek to avoid the stressful “back to school” shopping trip.
Barnes & Noble, the US bookseller, has secured a deal with John Lewis to distribute its Nook e-reader as it seeks to dent Amazon’s dominance of the UK digital book market.
John Lewis will be the first retailer outside the US to sell the Nook and will begin stocking it from this autumn in its 37 stores and on its website.
Launched in October 2009, the Nook has helped Barnes & Noble, the largest bricks and mortar bookshop in the US, eat into Amazon’s ebook market share. The popularity of its Kindle reader helped Amazon at one point claim to generate 90% of ebook sales in the US, but that has fallen to 60% as Apple’s iTunes store and the Nook make inroads. In Britain, publishers estimate Amazon controls 90% of UK ebook sales because of the lack of a digitally advanced rival .
Although the Nook range includes a full-colour touch-screen tablet, launched in February shortly after Amazon’s Kindle Fire, only its black and white e-ink readers will be available from launch in the UK.
“John Lewis is where knowledgeable customers turn for trusted advice on the best products to purchase, and they are a perfect partner to help launch Nook in the UK,” said Jamie Iannone, president of digital products at Barnes & Noble.
Yahoo Inc named veteran executive Kathy Savitt its chief marketing officer on Monday in the latest move by new CEO Marissa Mayer to overhaul her top leadership team.
Savitt, a former marketing executive at Amazon.com and American Eagle Outfitters, most recently founded Lockerz, a social commerce website that let online shoppers share links to clothing and accessory deals.
In a shock move, Mayer, 37, took the reins as Yahoo CEO in July after spending more than a decade as a high-profile employee at rival Google Inc.
Since her arrival, top Yahoo executives including interim CEO Ross Levinsohn have departed while Mayer began recruiting her deputies.
Lockerz said Monday that Chief Operating Officer Mark Stabingas will replace Savitt as CEO.
Al Wahda Mall is set to open more than 200 new stores on Saturday after leasing 90 per cent of the retail space in a major extension of the Abu Dhabi shopping centre.
The mall will double in size, with additional shops and food and beverage outlets, including a cinema and fitness centre, all adding to the 200 stores that are already operating there.
Virgin Megastore, H&M, American Eagle Outfitters and Calvin Klein will be among the major new brands in the mall.
“We are 90 per cent leased actually,” said Raja Abdulkhader, the director of Line Investment & Properties, part of Emke Group, the mall’s developer and the owner of Lulu Hypermarket. “It is now just a few small shops left.”
Mr Abdulkhader said the mall would have a big launch later next month, but declined to offer further details.
Already, major Middle East retailers, operating a wide range of international brands, have given their seal of approval to the project, confirming a host of stores to be opened next week.
Kuwait’s MH Alshaya has agreed to open 14 brands within Al Wahda, including Pottery Barn Kids, Dorothy Perkins, Miss Selfridge and Bath & Body Works.Azadea Group, from Lebanon, is also offering brands such as Pull&Bear, Bershka, Pepe Jeans, Jules, Piazza Italia, Tezenis and George, the budget value clothing line.
Landmark Group and Liwa Trading Enterprises have also signed up a number of their brands, such as Reiss, New Look and Gant.
M&Co, a Scottish fashion retailer with nearly 300 stores across the United Kingdom, will be the anchor clothing store in the new development, alongside BHS, another British department store.
The Al Wahda extension is the start of a wave of new or extended malls and shopping centres across Abu Dhabi that will change the retail landscape of the capital.
Stores in areas outside malls currently dominate the market in the capital, accounting for half of the total retail supply.
But that will change as retail space in the capital is set to grow from 1.68 million square metres to 2.3 million by the end of 2014, according to Jones Lang LaSalle, the property specialist.
It expects about 300,000 sq metres of retail space could enter the market this year, although some mall projects could be delayed.
Deerfields Town Square in Al Bahia, Emporium Mall at Central Market and Capital Mall are all expected to open their doors this year.
“The extension at Al Wahda Mall is forecast to thrust the mall to the forefront of the shopping experience in Abu Dhabi with a large spectrum of shopping experiences under one roof”, Yusuff Ali, the managing director of Lulu Group, the mall’s developer said earlier this year as he announced the brands going into the extension.
A buyer has been found for motorcycle clothing and accessory retailer Hein Gericke UK, which has five stores across the South West, the administrators have revealed.
Before falling into administration last month (July) the £18m-turnover company, headquartered in Harrogate in Yorkshire, operated 49 shops across the UK in addition to a catalogue and an online shopping service.
Appointed administrator, Moorfields Corporate Recovery, has confirmed an offer has been accepted from an unnamed party which will enable the Hein Gericke brand to continue its presence in UK towns and cities.
The sale of the business is expected to complete in early September.
Hein Gericke has stores in Bournemouth, Bristol, Cheltenham, Plymouth and Taunton in the South West.
Simon Thomas, joint administrator at Moorfields Corporate Recovery, said: “It is great to see that such a well-known brand and high street presence as Hein Gericke has been rescued. It is apparent that the name is held in high esteem and is a byword for quality in the industry.
“The buyer sees the potential for the business to overcome the recent economic pressures which have impacted over the past few years.”
Accounts filed at Companies House reveal falling sales at the business over the past four years from £24.6m in the year to 30 September 2008 down to £18.5m in 2011. Hein Gericke UK also posted a pre-tax loss in each of these years.
The UK business is separate from the parent company, which operates shops across Europe, trading within the UK under a license agreement with the German based parent company.
Hein Gericke was a German biker who opened a motorcycle shop in Germany in the 1970s. Within a few years the business developed to become the largest motorcycle dealership in Germany. The next decade saw the business expand to include clothing and accessories for bikers. The company had an international presence by 1987 at the point Hein Gericke sold his business.
The Hein Gericke brand is now sold through a retail shop presence across Germany, Austria, Belgium, Netherlands, Italy, Luxemburg and the UK.
French retail giant Carrefour has declined to comment on reports it is looking to cut 500 to 600 jobs in France.
According to French publication Le Figaro, Carrefour is expected to this week announce the removal of more than 500 jobs at its headquarters in France. The figure represents around 3% of the group’s workforce, a union representative told the publication.
The retail giant has had a tumultuous 18 months, which has included a series of profit warnings and shareholder dissent over its strategy after a plunge in its share price.
Profits and sales fell in 2011 and in April, the group booked a drop in sales for the first quarter of 2012, hit by weakness in its French hypermarkets and a “difficult” trading environment in Europe.
CEO Georges Plassatt has said it will take around three years to turn the company around as it looks to focus on reducing debt and overhead costs as well as exiting non-core markets. Further details on the plans are expected to be revealed on Thursday when the group publishes its first-half results.
Boosted by Wal-Mart association, chain targets opening 40 new stores by 2013
Johannesburg: Massmart Holdings Ltd., South Africa’s biggest food and goods wholesaler, will spend about 2.6 billion rand (Dh1.15 billion) in the second half of this year and 2013 as it expands and plans to open as many as 40 new stores.
Massmart expects net trading margins to start climbing from 2014 once the company “overcomes the hurdles” of increasing its number of distribution centres and upgrading its technology systems, CEO Grant Pattison said.
Massmart shares have climbed 21 per cent since South Africa’s Competition Tribunal in May last year approved Arkansas-based Wal-Mart Stores Inc.’s acquisition of a controlling stake in the company.
Massmart, with close to 340 stores in 12 African countries south of the Sahara, spent a record 1.7 billion rand in replacement and expansion costs in the fiscal year ended June 25. The company, which increased its cash from operations by 63 per cent to 2.7 billion rand, isn’t planning to raise money to fund growth as internal cash flows are adequate, Pattison said.
Net income rose 40 per cent from a year earlier to 1.17 billion rand in the year, the Johannesburg-based company said in a statement. Sales increased 16 per cent to 61.2 billion rand. Trading profit, or earnings before interest, taxes and some financial items, rose 3.8 per cent to 2.3 billion rand.
The company plans to open 30 to 40 stores in the next 18 months, with five of these in Africa outside its home market, Pattison said. Africa expansion is being slowed by the company’s difficulties in securing property, he said.
Wal-Mart’s purchase of 51 per cent of Massmart was approved last year, subject to conditions including the setup of a 100 million-rand fund to assist local suppliers and promises not to fire employees. While the transaction is “legally complete”, Massmart is still waiting for the final court ruling on the makeup of the fund and the company has not been notified of the date, Pattison said.
A South African firm has completed the takeover of Emirates Healthcare Limited (EHL), Dubai’s biggest private healthcare provider, via the purchase of the remaining 49.63 percent stake in the company that it does not already own.
Mediclinic International bought the stake from General Electric (5.24 percent) and the Varkey Group (44.39 percent). The deal for both stakes is worth US$224m.
EHL has two hospitals – Welcare Hospital and The City Hospital – and eight operational clinics in Dubai. A ninth clinic will open later on this year.
The company employs around 1,900 staff and treats over 600,000 patients a year.
Mediclinic, South Africa’s second-biggest private healthcare operator, said it would fund the purchase via a equity and debt funding raised in Dubai via Standard Chartered.
The Dubai-based Varkey Group, which runs the GEMS Education network of schools, said that the move was in line with its strategy to focus on education.
“The decision by Varkey Group to exit its healthcare interest is only due to the Group’s strategic intent of continuing to focus and grow its education business at a faster pace globally,”said CN Radhakrishnan, a senior director at the Varkey Group, in a press statement.
It is perhaps hard to imagine the 82-year-old billionaire investor George Soros and his 40-year-old fiancee cheering on Sir Alex Ferguson’s Manchester United at Old Trafford.
But Soros, who paid £25.8m for just under a 2 per cent stake in the club last week, is one of a number of US-based billionaires who have made some eye-catching investments in the UK.
It ought to be a huge vote of confidence for a company when an investing legend such as Soros arrives on the share register. But winning Soros’s backing is no guarantee of success. The same is true of fellow US billionaires Bill Gates and Warren Buffett.
Hungarian émigré Soros, who has a reputation for trading on instinct, shot to fame in 1992 when he made more than £640m betting that the UK would be forced to devalue the pound and pull out of the European exchange rate mechanism.
But observers in London were scratching their heads over whether those normally infallible gut feelings had deserted him this time. Some speculated he might be a Red Devils fan, buying 7.85 per cent of Class A shares with his heart, not his head.
Head of equities at Lansdown Hargreaves, Richard Hunter, said: ‘Rich owners who plunge hundreds of millions into football clubs do leave you wondering if they will ever get their money back. You could also say a similar thing about those, like Soros, who take large stakes in clubs. It is notoriously difficult to make money from football.’
Others took a more charitable view. ‘What you are betting on is that media exposure in newer markets in Asia and the US will continue to grow for Manchester United,’ said one observer.‘This leads to extra money from TV rights deals, which in turn should lead to higher sales from merchandising. The vagaries of results on the pitch can make the sums difficult, but it can work.’
Soros is not the only billionaire to have set tongues wagging with seemingly unlikely investments.
Founder of Microsoft Bill Gates, a protege of investment guru Warren Buffett and one of the world’s richest men, has also made some possibly eccentric choices.
In 2009 he bought just over 3.1 per cent of struggling retail chain JJB Sports. At the time the market took this as a vote of confidence, but three years on the business is still losing cash and market share to rival Sports Direct.
Gates bought into JJB at around 24p a share – today the stock is hovering at around 3p. A year earlier Gates bought a 3 per cent stake in flooring retailer Carpetright for £15m, and in 2010 doubled this to 6pc. The company has issued seven profit warnings in just over a year and even hardened market watchers are baffled at these moves.
At the time respected retail analyst Nick Bubb simply said: ‘Some people have more money than sense.’
Others say that the willingness of these investors to stand out from the crowd is a key part of their entrepreneurial spirit.
Hunter said: ‘They have a strong belief that they are right and are not afraid to swim against the tide.’
Another fund manager pointed out that unlike many UK institutional investors, the US-based billionaires are strategic players.
‘They buy because they believe the stock will rise over the long term,’ he explained.
Buffett, known as the Sage of Omaha, is worth £27.8bn. He looks for firms with strong management teams that have delivered good earnings over time but have been undervalued by the market. He then takes a significant holding in that business. ‘Try to be fearful when others are greedy and greedy when others are fearful,’ is his mantra.
It perfectly illustrates the timing of Buffett building up his stake in Tesco in January.
The UK’s largest retailer issued its first profit warning in more than 20 years, which wiped more than £5bn off its share price.
Buffet saw this as a blip and raised his stake in the company to 5.08 per centc from 3.21 per cent at a cost of around £480m.
One fund manager said: ‘The UK business is where sales are slowing, but it still generates a lot of cash. Buffett is betting the firm’s experienced management team will turn it around.’
He also owns a stake of £48m in drug giant GlaxoSmithKline, which he bought in 2008. The pharmaceuticals firm has had its ups and downs. It was recently hit with a $3bn (£1.9bn) fine in the US for paying American physicians to prescribe potentially dangerous drugs, but chief executive Sir Andrew Witty has beefed up the consumer side and overhauled top pay, which was a toxic issue under his predecessor Jean Pierre Garnier.
Other high profile Americans have also entered the fray.
Former US vice president Al Gore is not in the billionaire big league, but he does have clout as one of the world’s foremost environmentalists. He became an early investor in Ocado, whose share price has been volatile but currently stands at around 63p.
Whether the hunches of Buffett and Soros turn out to be correct remains to be seen.
But as Bill Gates’s ill-starred foray into sportswear and carpets shows, even billionaires can make the odd mistake.
TROUBLED Gold Coast-based surf wear company Billabong has posted a net loss after tax of $275.6 million for 2011-12.
The result was a large drop on the $119.1 million net profit Billabong reported for 2010-11.
Billabong said this morning it expected the current challenging trading conditions to continue in its 2013 financial year.
It said assuming there was no deterioration in the conditions, earnings before interest, tax, depreciation and amortisation (EBITDA) was expected to be between $100 million and $110 million, in constant currency terms.
The company’s EBITDA for its 2012 financial year was $84 million, excluding contributions from its recently sold Nixon brand and significant and exceptional items.
Billabong, which is the subject of a takeover offer from private equity group TPG, said its improved earnings would come on the back of its transformation plan, also unveiled today.
Billabong CEO Launa Inman said: ”At an underlying trading level, the group remains profitable.
”As previously flagged to the market, the group’s results have been adversely impacted by various significant and exceptional items.
”The group is well on track in implementing the initiatives outlined in the previously announced strategic Capital Structure Review and will continue to implement a number of new strategic initiatives announced today as part of Billabong’s transformation strategy.”
A major revamp of the company’s websites to promote online sales of its new youth surf, skate and snow brands will be accompanied by a slashing of unpopular products. As well, another 82 underperforming stores will close.
It will standardise the look of its stores and appoint a new global brand manager to unite its design teams in Australia, France and the US, as takeover talks with private equity firm TPG continue.
TPG is carrying out due diligence on Billabong International after it made a $1.45-a-share takeover bid for the retailer in late July.
Releasing her much-anticipated plan to turn the surfwear giant around and return the company to positive growth, CEO Launa Inman said her aim was to restore Billabong as the “premier youth brand in the world”.
“Billabong is a great company (but) there remains a lot of hard work ahead of us to return the Billabong Group to its former position,” she said.
Ms Inman admitted the company’s ill-conceived move into the retail market left much to be desired, leaving it battered by a global slowdown in its major overseas markets and allowing young up-and-coming youth brands to eat into its market share.
But she said the company’s research showed the brand was still “one of the most loved brands in Australia”.
The transformation strategy will see a further 82 stores closed globally throughout 2013.
The company will continue selling off old stock and the number of existing product lines will be cut.
“We have more than 25,000 styles we produce on an annual basis,” Ms Inman said.
“What shocked me most was that we identified 34 per cent of our styles give us 1 per cent of our sales.”
She said the number of product styles would be cut by 15 per cent this year, then another 15 per cent if this proved successful.
Billabong will also begin a major push into online retailing, launching its own online platform and expanding and integrating the Surfstitch brand it owns in Australia and Swell in the US.
The company’s core business will also be simplified to concentrate on Billabong and push the RVKA, Decline and Element brands.
Hot young fashion brand Jack Wills has appointed a former Vodafone and Carphone Warehouse executive to its board, igniting speculation that the business may be preparing for a sale or float next year.
Wendy Becker, Vodafone group marketing chief until last year, is also a non-executive at Ocado and Whitbread.
She will be joining Jack Wills in an ‘operational role’.
Jack Wills declined to comment, but a source said: ‘Peter Williams, the founder and chief executive, is remaining in his role and Wendy will join the board in an operational position this autumn.’
The already powerful board includes former Burberry chief executive Rose Marie Bravo, credited with making the brand a global success, and former Ralph Lauren senior vice-president James Hardy, who is president of the US operation.
Jack Wills already has stores in Britain, many in university towns, 12 stores in America and two in Hong Kong.
Tiffany & Co. (TIF), the world’s second- largest luxury jewelry retailer, jumped the most in a year after reporting a drop in worldwide comparable-store sales that was smaller than some analysts projected.
Tiffany advanced 7.2 percent to $62.71 at the close in New York, for the biggest gain since Aug. 26, 2011. The shares have declined 5.4 percent this year.
Sales at stores open at least a year dropped 1 percent, excluding the effect of currency exchange-rate fluctuations, the New York-based company said in a statement today. David Schick, an analyst with Stifel Financial Corp., estimated a 3 percent decline. Comparable-store sales in Europe rose 2 percent, while Schick projected a 5 percent drop.
“There were some fears among investors that the worldwide comparable sales number could be a lot worse,” Schick, who’s based in Baltimore, said in a telephone interview today. “The numbers have shown some resilience in the brand.”
Schick recommends holding the shares.
Tiffany’s comparable-store sales decline was “not as bad as feared,” Brian Nagel, an analyst at Oppenheimer & Co. in New York, wrote today in a note. He rates the shares outperform, the equivalent of a buy.
Sluggish economic growth, the struggling housing market and persistent joblessness have hampered some American consumers’ purchasing power.
Economic uncertainty prompted Tiffany to cut its annual profit and sales forecasts today for a second time this year. Sales have been curbed by weaker spending by Americans in their home market, with demand fluctuating at all price points, and by restraint among European tourists in New York, Mark Aaron, a company spokesman said on a conference call today.
Global net sales will increase as much as 7 percent this year, down from a previous forecast of a maximum of 8 percent, and an original projection of 10 percent, Tiffany said.
Tiffany said profit excluding some items in the year ending Jan. 31 will be $3.55 to $3.70 a share, down from a May forecast of $3.70 to $3.80 a share. Analysts projected $3.64, the average of 24 estimates compiled by Bloomberg. In March, Tiffany forecast profit of as much as $4.05.
Net income in the three months ended July 31 increased 2 percent to $91.8 million, or 72 cents a share, from $90 million, or 69 cents, a year earlier. Analysts projected 73 cents, the average of 21 estimates compiled by Bloomberg.
Revenue in the second quarter rose 1.6 percent to $886.6 million. The average of 19 analysts’ estimates was $890.1 million.
Sales at stores open at least a year retreated 5 percent in the Americas, including a 9 percent drop at the jeweler’s main store on Fifth Avenue.
Tiffany’s flagship store accounts for 8 percent of worldwide sales, and a little more than 40 percent of that comes from foreign tourists, Aaron said at an investor conference in April.
Tiffany also said in a regulatory filing today that it was discussing with Elsa Peretti a phased wind-down of sales of the designer’s products as an alternative to buying her trademarks. Peretti, 72, wants to end her agreement with Tiffany, which produces 10 percent of the jewelry retailer’s sales, the company first disclosed in May. A phased wind-down would mitigate the impact on the company, according to the filing.
A multimillion dollar Bahrain mall project faces an uncertain future and may be scrapped following a dispute between the local council and the parliament over plans for the derelict site, it was reported at the weekend.
Plans for the mall were thrown into disarray after Bahrain’s Municipalities and Urban Planning Affairs Minister Dr Juma Al Ka’abi was forced to intervene in a row between the Manama Central Municipal Council and Bahrain parliament over plans for the site, Gulf Daily News reported.
An investor had already purchased the land, which was valued at around BHD8m (US$21m) and was the site of the old Batelco headquarters which had been empty and derelict for decades.
However, MPs have argued that the site should instead be turned into a public park for local residents. As a result of the feud, Al Ka’abi has halted the plans until a solution can be found.
“We have been put in a difficult situation and that’s finding a balance between the demands of the council and parliament in regard to this plot of land that everyone wants to see developed,” he was quoted as saying by Gulf Daily News.
“I have decided that the mall project can’t go ahead because the place is residential and can’t take any more traffic or parking problems, besides the plot is the only available land for us to carry out any municipal project,” he added.
The minister is now considering a number of different options: relocating the mall project to another site or revamp the plans to incorporate more green space with family recreation and leisure elements.
The mall is the latest development in Bahrain to face an uncertain future after backers were forced to amend their plans.
Last week it was revealed plans for a US$63m park in Bahrain, which were due to include the country’s first full-size ice arena, an aquarium, aquamarine centre, karting track and amusement rides, has been thrown in jeopardy after officials said the plans contained too many commercial elements.
The Muharraq Grand Garden, located near Bahrain International Airport, was due to contain garden space of 93,000 sqm and built up areas, including restaurants, a fitness club and gym, an elderly centre and family resting areas.
The Muharraq Municipal Council has ordered developers to revamp the designs to include less commercial retail elements, the Trade Arabia news outlet reported.
Sir Paul Smith, the UK fashion designer, is optimistic about his brand’s return to China, despite fears that the Chinese market for luxury goods is cooling.
Speaking for the first time since the return to China was announced in May, Sir Paul said it had been “massively disappointing” to pull out five years ago.
At the time, he branded the Chinese market as “extremely dangerous” as rents were very high and the majority of the population only wanted “clothes to cover their bodies”.
But speaking to the Financial Times in his design studio and offices in Covent Garden, Sir Paul said the Chinese market was now ready for his brand.
Five years ago, Chinese consumers “wanted things that say I’m wealthy and I’m fashionable. They wanted things with a logo on”, he said.
Now many young Chinese travelled frequently and had also become aware of the Paul Smith brand via the explosion in social media.
“There is a lot more awareness of Paul Smith now than there used to be,” he said. “There are a lot of people who are not necessarily looking for the obvious symbols of wealth or fashion. They are more looking to buy things that they know are interesting, or special.”
He added: “I am not saying it will work at all. I’m saying there is more chance now because of the awareness of Paul Smith.”
Paul Smith, which has 159 stores worldwide, will make its second attempt to crack the Chinese market with ImagineX, a sister company of Hong Kong’s Lane Crawford department store.
They aim to open 20 stores in China over the next five years. A store in Tianjin will open before Christmas, with another in Shanghai next June.
Sir Paul acknowledged that the entry may be coming at a delicate time for the Chinese luxury market, as the country’s slowing economy saps demand for luxury goods.
“With China it’s not necessarily the right time, no. That is why we are doing it so gently and so cautiously,” he said.
Sir Paul said he always looked for unusual store locations and it was “extraordinarily disappointing” that this was not yet possible in China, where most outlets tended to be in malls.
The comments came ahead of Sir Paul being inducted into the World Retail Hall of Fame at the World Retail Congress in London next month.
Sir Paul said he expected sales at his privately-owned group – he owns 60 per cent – to be “probably level” in the year to June 30. Retail sales are expected to be up 8 per cent.
Plans for Mary Portas’ latest venture have suffered a major setback as four people from a town the so-called Queen of Shops was due to overhaul have resigned in disgust.
Margate in Kent is one of 12 ‘Portas Pilot’ towns picked by Local Government Minister Grant Shapps to receive help from the retail guru, fighting off competition from more than 350 entrants.
But four members of Margate’s ‘town team’ have resigned amid accusations that Ms Portas’ film crew was more interested in making controversial television than helping the town.
Queen of shops: Mary Portas’ scheme aims to revive the fortunes of flagging high streets. Twelve have so far been selected from across Britain
Each of the 12, which include Stockton-on-Tees, Bedford and Wolverhampton, is to receive cash from the Government and free advice from Ms Portas to revitalise their flagging high streets. Margate is due to receive £100,000.
Robin Vaughan-Lyons, chairman of the Margate town team and a local shop-owner, is the most recent member to quit. He said the filming of a Channel 4 documentary series had turned into a bitter power struggle.
Mr Vaughan-Lyons’ resignation followed that of the vice-chairman, tea shop owner Roxanne Tesslar; the treasurer, bistro owner Ian Darkler-Larkings; and the group’s secretary and press officer, Louise Oldfield.
Shorely not: nearly 40 per cent of shops in the seaside town of Margate stand empty and remaining shop-owners were desperate to see their fortunes improve
He accused the TV crew of deliberately trying to stoke up disagreements between the team’s leadership and businesses in the town, claiming Ms Portas had ‘completely blanked’ the town’s bosses while she attended filming.
Mr Vaughan-Lyons said the rows – which erupted as the film crew returned to Margate for a second spate of filming, following the town’s successful bid to be included in the Portas scheme – came even before the town team could draw up a plan on spending the £100,000.
‘I’m absolutely devastated but I was left with absolutely no option,’ he told The Grocer magazine.
Faded lights: Margate has struggled to regain the popularity it enjoyed in the Victorian era
He added: ‘There are a group of people who are more interested in publicity and being on TV than they are in helping Margate and they have been deliberately encouraged by the film crew to make personal attacks on us.
He told the magazine: ‘We have not objected to the filming of the show but for us it’s more about what we do to help the high street. But the filming has led to all sorts of disgraceful activity.’
Ms Oldfield said in her resignation statement: ‘My position has become untenable, with individuals consistently acting outside the team. I have been subjected to public bullying by individuals who are seeking to further their own personal interests rather than the aims of the bid.’
Not amused: members of Margate’s town team complained of people who were more interested in publicity than doing the job of sorting the town out
When Ms Portas arrived with the TV crew in June she caused outcry at a meeting with local traders when she appeared to suggest that the documentary was a pre-condition of getting the government grant.
She said: ‘We either let the cameras in with me, or I go back on the train and some other town gets it.’ She has since said she had made a mistake.
Mary Portas’ spokesman, Peter Cross, said the loss of the Town Team was ‘a terrible shame for the individuals’ but that it wouldn’t stop Margate benefiting from the initiative.
‘Margate deserves it,’ he said. ‘This Town Team has failed. It’s not for us to get into the politics. There are going to be many more obstacles to come. Mary would say it’s far better to try than to do nothing. Margate will succeed. It will succeed with a different Town Team.’
CVC Capital Partners Ltd. has explored taking Marks & Spencer Group Plc (MKS) private as the U.K.’s largest clothing chain’s sales slump amid a lack of demand for its fashions, people close to the matter said.
CVC approached executives both inside and outside the company about a possible management role under private equity control, said the people, who declined to be identified as the talks were confidential. The buyout firm has not moved beyond a preliminary examination of the U.K. retailer and is not currently thought to be pursuing a bid, the people said.
That comes two years into Chief Executive Officer Marc Bolland’s tenure, during which he has vowed to rejuvenate sales with a multichannel, international approach and to focus on its brand strength. Photographer: Scott Eells/Bloomberg
Marks & Spencer shares jumped as much as 8.25 percent, the most in more than three years, in London trading. The stock was up 4.26 percent to 371.7 pence at the close, boosting this year’s share gain to 20 percent.
Officials at CVC and Marks & Spencer declined to comment.
A buyout of Marks & Spencer may be hampered by the 5.7 billion-pound ($9 billion) market value of the retailer, its debt and pension liabilities as well as the need to restructure the company, whose general merchandise sales are underperforming the market. The 128-year-old clothing and food retailer reported its first profit drop in three years in May. That comes two years into Chief Executive Officer Marc Bolland’s tenure, during which he has vowed to rejuvenate sales with a multichannel, international approach and to focus on its brand strength.
A “successful bid is highly unlikely for M&S,” said Bethany Hocking, an analyst at Investec Securities, who has a ‘sell’ recommendation said. “It would require a very large equity raising; the pension fund and trustees could represent a significant barrier; and although Marks has property, it is predominantly high-street stores.”
Same-store sales of general merchandise, which is mostly apparel, fell 6.8 percent in the quarter ended in June, the worst performance since 2008. At the time, the division’s leader, Kate Bostock, also announced plans to step down.
The seller of apparel, specialty foods and housewares was “vulnerable” to a takeover bid, Paul Mumford, a fund manager at Cavendish Asset Management Ltd. told Bloomberg News last month, citing its cheap valuation, cash generation, strong brand and food business.
On July 31, the retailer was valued at 6.2 times earnings before interest, taxes, depreciation and amortization, the biggest bargain in more than seven years. The stock has since rallied and is now valued at 10.9 times, according to data compiled by Bloomberg News.
Today, the retailer would have an enterprise value, or market value including debt, of about 7.5 billion pounds, according to Bloomberg data.
CVC attempted to buy J Sainsbury Plc (SBRY) in 2007 but was forced to scrap the 10 billion-pound offer after the private-equity firm’s partners walked away and the Sainsbury family and pension trustees opposed plans to sell property assets.
Marks & Spencer, which traces its roots to 1884, is the U.K.’s largest clothing retailer by sales. The company runs more than 1,000 stores, most of which are located in the U.K. and Ireland.
CVC, whose main office is in London and which manages a 10.8 billion-euro ($13.5 billion) European buyout fund, owns companies including car-racing group Formula One.
Debenhams will launch its first store in Russia this Saturday and has “big plans” to roll out more shops in what is set to become Europe’ biggest retail market.
The department store chain will open a 35,000sq ft shop – about half a football pitch – in Moscow’s Mega Belaya Dacha mall via its franchise partner, Debruss.
The store will showcase beauty and cosmetics ranges, homewares and all its exclusive Designers at Debenhams range. The UK retailer has already advanced plans for more stores in Russia, which is set to become Europe’s biggest retail market by 2013-2014.
Francis McAuley, Debenhams’ international director, said: “We have big plans for future growth; this will be the first of many Debenhams stores in the country with a further eight already in the pipeline.”
Debenhams, which has 70 franchised stores in 26 countries, including Iran, Malta and Malaysia, aims to double the size of its international business over the next five years.
Other UK retailers, including Marks & Spencer and Ted Baker, are also expanding overseas, as they seek fresh avenues of growth away from the challenging trading conditions on the UK high street.
Russia has a population of 143 million and a rapidly growing middle class. Mr McAuley said: “Russia is a key market. With an annual footfall of 70 million, Mega Belaya Dacha is the perfect spot for our first opening.”
The retailer aims to benefit from the British heritage of its products and said its exclusive designer ranges – which include Butterfly by Matthew Williamson, H! by Henry Holland, Rocha by John Rocha, and J by Jasper Conran – will be new to the Russian market.
Debenhams recently posted underlying sales increases of 3.1 per cent over the 16 weeks to 23 June. Its shares closed at a 12-month high of 95p on Friday, valuing the retailer at £1.12bn.
The British Retail Consortium has appointed Helen Dickinson, the head of retail at KPMG, as its new director general. The organisation has also announced that Ian Cheshire, group chief executive of Kingfisher, is to become its new chairman, replacing current chairman Rob Templeman.
Dickinson succeeds Stephen Robertson as director general who will leave the organisation on 1 January 2013 after five years in the role. With 20 years’ experience at KPMG as its UK head of retail and audit and relationship partner, Dickinson is also a founder member and chair of the KPMG/Ipsos Retail Think Tank and a regular contributor to The Retail Bulletin.
Commenting on the appointment chairman Rob Templeman said: “Ian and I are delighted to welcome someone of Helen’s calibre to lead the BRC in its next phase of development. She brings a wealth of knowledge and understanding of the sector to the role. Her extensive experience at the highest level will help us support members through these challenging times.
“On behalf of all the BRC’s members, I would like to thank Stephen Robertson for leading the BRC so successfully over the last five years.”
Dickinson added: “Against the current economic backdrop, the BRC’s work in supporting retailers to develop their businesses and tackling the challenges that they, and the sector, face is more crucial than ever. “
Ian Cheshire will take over the role of BRC chairman on 1 October 2012 from current chairman Rob Templeman and will serve for a period of two years.
Cheshire is a major retail industry figure. Having held the position of group chief executive of Kingfisher since January 2008, he also serves as a lead non-executive member at the Department for Work and Pensions and is a member of the Corporate Leaders’ Group on Climate Change and a member of the Employers’ Forum on Disability President’s Group.
Templeman will stay on for a further year as deputy chairman, taking over from Lucy Neville-Rolfe who is Tesco’s outgoing corporate and legal affairs director.
Commenting on Cheshire’s appointment Robertson said: “I am delighted that Ian has accepted this role. He has a rich understanding of retail and of the political process. The BRC will benefit hugely from having a serving retail Chief Executive of Ian’s stature as its Chairman.
“My thanks to Rob who has been a diligent BRC Chairman and, to me personally, an inspiring and remarkable leader. We have achieved a great deal under Rob’s wise guidance. I’m very pleased his knowledge and expertise will not be lost to the BRC.
“Thank you, too, to Lucy who has served with distinction as our deputy chairman.”
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This September, Bijoux Terner, the global fashion accessories brand, will go where it has never ventured before: the worldwide web.
Parent company BT Fashions will be launching an Internet store in the coming weeks. The online boutique will bring Bijoux Terner’s wildly popular assortment of affordable jewelry, watches, scarves, bags, and fashion accessories to consumers’ fingertips. The store will launch just in time for the brand’s anticipated line of Fall and Winter styles and make those looks available to fashionistas across the United States.
Bijoux Terner has been delighting fashionistas around the world with its collections of affordable fashion accessories for nearly 40 years. The brand, famous for its locations on cruises, in airports, resorts and casinos, and other travel retail locations, can be found in over 60 countries across 6 continents around the globe.
The anticipated ecommerce initiative brings the award-winning concept to those who do not live near or cannot easily access one of the company’s nearly one thousand physical locations and spreads the brand’s reach online.
Leading sports lifestyle firm Puma is all set to open its first sustainable (read green) standalone store in Bangalore as a part of a global initiative.
“This is Puma’s first such store in the world. We are starting the project with India and depending on its success, will replicate it in other countries,” said Rajiv Mehta, Managing Director, Puma.
He added that Puma’s Indian arm, in 2010, had won the global PPR Innovation and Sustainable Development Award for a project to build an energy-efficient, eco-designed store. After bagging the award, India was chosen as the destination.
The Bangalore store has incorporated several elements of sustainability such as solar PV panels installed on the roof to generate electrical power, an air tunnel for cooling, use of shoe cartons-cum-carry bags and the use of organic cotton for apparels. The surface layout of the store has been designed in a way to ensure optimum use of daylight.
Mehta added that the company would soon be launching its winter collection apparels made of organic cotton. Noting that these initiatives would not only help mitigate costs and risks, he said it would also help grow the business.
Also, material utilised in the store is to be locally sourced and recycled. The company has also partnered with installation artists from the city to create art from using waste material.
Asked whether the company would convert all its existing stores into green stores, Mehta said the company might look at constructing new stores rather than renovating the current ones.
However, without disclosing the number of green stores the company plans to construct going ahead, Mehta said the focus would be on metros and tier-II cities.
“Mall owners in India have started the green initiative a year ago and retailers appear to be following suit. They are doing this from various standpoints. Several retailers are already chalking out plans to go the green way,” said Kumar Rajagopalan, CEO, Retailers’ Association of India.
From charging for carrier bags to installing less harmful refrigeration systems, retailers are improving their green credentials to appeal to environmentally aware consumers, he added.
Meanwhile, mall developers such as Oberoi and Inorbit have also started looking at this aspect and are building malls that are more energy and water efficient.
Globally, wholesale retailers such as Walmart and Tesco are very focussed on energy efficiency such as LED lighting in refrigerated cabinets and zero-carbon store programmes.
Books and stationery retailer WH Smith Plc said it expects full-year results to be at the top end of market expectations and announced a fresh share buyback programme of up to 50 million pounds ($79.02 million).
The company said the board has decided to commence the share buyback for the financial year ending Aug. 31, 2013. It completed a similar share repurchase programme on Aug. 7.
The company, which sells newspapers, books and stationery, said its travel business continued to win new business.
The 220-year-old company said book sales rose in its High Street stores.
The company, which operates over 1100 stores primarily in the UK, said its travel and High Streets businesses remain highly cash generative.
WH Smith will announce its preliminary results on Oct. 11.
The company’s shares, which rose 22.5 percent in the last year, were up about 4 percent at 607 pence at 0704 GMT on the London Stock Exchange.
Sportswear retailer JD Sports has agreed a deal to sell the Canterbury rugby brand to sports and fashion retail group Pentland for £22.7m.
As part of the deal, JD will buy the OneTrueSaxon brand from Pentland, which owns Berghaus and Speedo, for £50,000.
JD, which says it does not sell much Canterbury product, does not see the brand as being core to future plans.
The group only bought into the rugby kitmaker, which supplies the Scotland and South Africa teams, in 2009.
Canterbury also supplies the kit to major rugby union sides such as Leicester Tigers. Leinster, Cardiff Blues and Glasgow Warriors.
“Having reviewed the options for Canterbury, we are pleased to have agreed its sale to Pentland on terms which are attractive for JD and provide Pentland with the opportunity to further build and develop the Canterbury brand,” said JD’s executive chairman Peter Cowgill.
The company said it would use the proceeds from the sale to invest in its core retail business.
Fat Face, the casual fashion retailer, is eyeing expansion outside the UK, after stabilising its domestic business by kicking the “discounting drug”.
Anthony Thompson, chief executive, said the privately owned retailer was looking at potential overseas markets.
“We are now investigating and researching it quite seriously,” he said. “The plan there is to, over the next 12 months, research various markets and filter down to a handful that we think our brand would travel well to.”
He expects Fat Face, which is owned by private equity group Bridgepoint, to begin its international expansion within a year.
“I don’t want to rush into it. I feel what is important is when you look to export your business, your home market is strong,” said Mr Thompson, a former senior executive at Asda and Marks and Spencer.
In the 53 weeks to June 2, Fat Face increased sales by 7 per cent year-on-year to £163.6m, helped by the performance of its online business, new space and existing stores.
Earnings before interest, tax, depreciation and amortisation were flat at £24.1m, after Fat Face took the decision not to pass on higher cotton prices to customers. It was also profitable at the pre-tax level, with a surplus of about £500,000, for the first time in some years.
The increase in sales came despite Fat Face’s “coming off of that discounting drug” in a highly promotional market, said Mr Thompson. The retailer was now discounting a third of the amount of goods that it marked down two years ago, he said.
At that time, 50 per cent of goods were sold on discount. The proportion marked down was now about 25 per cent, and Mr Thompson said he aimed to reduce this to 20-22 per cent over the next 12 months.
Fat Face would continue to hold its nerve, he said, and would again not begin its post-Christmas sale until December 26.
As well as overseas expansion, Mr Thompson saw scope for Fat Face to continue to open 10-15 UK stores a year for the next three years, with most opportunity around transport locations and holiday destinations.
Bridgepoint acquired Fat Face in 2007 for £360m. At June 2, net debt was cut from £150.6m to £140m year-on-year, helped by a repayment of £8.6m.
“We are highly cash generative business and that debt is coming down really quite quickly,” said Mr Thompson. “We have no issues with our covenants. We are very confident we will pass any covenant test over the next 12 months.”
He said trade in Fat Face’s first quarter had been tough amid a promotional high street, but the group was slightly ahead of plan. Trade was strong over the Olympics, ”and that positive glow seems to have continued over the last 10 days”.
Value retailers are becoming more attractive to potential investors as they continue to thrive during tough economic climes as cash-strapped customers seek out bargains, according to a report by Shore Capital.
At the end of 2011 value retailers operated from 16m sq. ft. and this space is continuing to grow. With the discount and value channel worth £5bn in 2011 and set to expand to £8bn 2014/15, there is plenty of growth potential, making this channel amongst the fastest growing segment of the market alongside online and convenience.
The demise of Woolworths has created a gap in the market, however value retailers must continue to tackle the threat of inflation in managing prices.
TJ Morris, which trades under the Home Bargains fascia, came top of the profits table, expected to deliver a forecasted £70.9m at a pre-tax level for 2012, trading from 250 stores. And there is more to come as Shore Capital describes the company as “highly immature”.
It said: “The stores are the epitome of good retailing to us; simple, well stocked and busy.”
Conversely, the largest value retailer, 350 store Wilkinson is not translating space into sales, although it remains profitable at pre-tax with £22.74m.
Shore Capital said: “Wilkinson remains a profitable, robust and successful family business; the sort of venture that the UK economy needs. However, within the high street value retailer subset its relative maturity and declining operating metrics leave the group lagging in some respects – so whilst Wilkinson is the largest, it is not ‘the daddy’.”
Among the single price retailers Poundland is the stand-out winner with a £26.8m pre-tax profit forecast in the current financial year. The analyst believes the retailer has the potential to nearly double its 340 store estate which makes it a leader in the value sector.
Alongside Poundland and TJ Morris, B&M Bargains is the third stand-out prospect in the sector. With a pre-tax profit of £60.94m forecast for the current financial year, B&M Bargains is one to watch and one that could carry “significant” buyer interest due to its “robust” net cash according to the analyst.
Poundworld’s forecast £7m pre-tax profit for this year and 200 stores has meant the retailer has “sustained robust growth but from a still modest base” and observers will be interested to see whether this momentum continues. Shore Capital said: “Sustained store development and rising margins may yet prove to be the rewarding exit for the owners.”
Family-owned 99p Stores generated a £7.17m pre-tax profit in its last update trading from 174 stores and is reported to be up for sale as DC Advisory was brought in to explore strategic opportunities. Again, there is massive growth potential and the retailer has 600 UK stores in its sights.