Bonmarche Q3 sales drop less than expected

Bonmarche posted a drop in third-quarter sales on Friday but said trading remains in line with the revised guidance given at the update in December and the winter sale has started well.

In an update for the quarter to 29 December 2018, the womenswear retailer said total sales declined 8.1%, with store only like-for-like ales down 11.1% and LFL stores and online sales 7.8% lower. Still, a slight improvement in footfall towards the end of December meant the stores LFL sales figures were a touch ahead of the 12% decline expected by the group.

Online was a brighter picture, meanwhile, with sales in that segment up 22.2% during the quarter.

Bonmarche said the winter sale has begun well and it continues to trade in line with the revised guidance given in its trading update in December, when in warned on profit.

The group said its cash reserves are expected to be adequate to meet its liquidity requirements, even at the lowest end of the pre-tax profit range, and during the period when the cash balance is lowest, around the end of March.

Chief executive Helen Connolly said: "Clearly, in the short time since our last update, macro market conditions have not changed, but I am pleased that the sale stock is clearing well and that trading is in line with our revised expectations. In the short term, we continue to focus on ending the year with a clean stock position and ensuring that our balance sheet remains healthy.

"Looking forward, the board remains confident in Bonmarche's prospects and strategy and we will continue to drive the implementation of our previously outlined plans, maintaining a particularly strong emphasis on increasing multi-channel sales."

At 1020 GMT, the shares were down 6.7% to 39.55p.

Shares in Bonmarche tanked back in December when it warned that profits would be lower as stores sales were hit by Brexit worries and "unprecedented" high street trading conditions.

It said full-year underlying pre-tax profit would come in between break-even and a loss of £4m, versus previous estimates of £5.5m profit.