The clothing company for plus-sized fashion-lovers has slimmed down its profit expections for the second time in five months.
Shares in N Brown, the owner of Simply Be, JD Williams and Jacamo — which count Kelly Brook, Lorraine Kelly and Andrew Flintoff as brand ambassadors — closed nearly 16 per cent lower at 343½p yesterday after its latest profit warning, which it blamed on a difficult early autumn.
Angela Spindler, the internet and catalogue retailer’s chief executive, said that it had already been in a period of “heavy lifting” when trading deteriorated.
A decision to tighten credit conditions and a change in its marketing plan, to put more of its investment behind its largest brands, had dampened headline sales. “It was going to be a tough year, but we felt we were managing it tightly and we were there or thereabouts in terms of expectations — then September and early October came and that knocked us very much off-track,” Ms Spindler said.
N Brown also announced that it would close its Gray & Osbourn catalogue business, which it said would result in exceptional costs of between £11 million and £13 million for the full year.
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It said that “tactical and strategic” price investments that had helped to clear inventory meant that it would miss City forecasts of £88 million profit for the year to February 28. However, like-for-like sales were 3.6 per cent higher in the final quarter.
Ms Spindler has allowed customers to pay with cash in an attempt to broaden the appeal of the business, which previously operated on credit.
About 30 per cent of new customers opt to pay upfront, but that still accounts for only 10 per cent of overall trade.
N Brown, which also focuses on older shoppers, said that full-year sales were flat, with revenue from its financial services business “representing a headwind, driven by measures to further improve the quality of our debtor book”, but it said that the level of customer debt arrears was at a record low. Anusha Couttigane, a Conlumino consultant, said the business was taking decisions that, although painful in the short term, would stand it in good stead. “For a company that expertly deals with the niche needs of its core customers and has a solid business plan going forward, this represents a satisfactory set of results,” she said.