Appreciate warns trading weaker than expected

Appreciate said trading so far in 2021 was weaker than expected as the retail and rewards group reported an 83% drop in annual profit caused by Covid-19 disruption.

Pretax profit for the year to the end of March fell to £1.3m from £7.7m a year earlier as revenue dropped 5.2% to 106.8m. Excluding £1.1m of redundancy and other costs, pretax profit before exceptional items fell to £2.3m from £11.4m.

Appreciate said trading in the first 12 weeks of this financial year was slower than expected as customer sending stayed unsettled by the pandemic. The Christmas savings order book was affected by social distancing measures and higher levels of unspent vouchers.

The AIM-traded company said it was working to recruit Christmas savings customers but that orders were expected to be down 14% compared with an 11% reduction it forecast in April. Appreciate shares fell 14.4% to 33.8p at 10:26 BST.

Ian O'Doherty, chief executive, said: "Whilst there is optimism following the success of the vaccine rollout, uncertainty about the speed at which normal levels of activity will return remains. Despite a slower than anticipated start to the new financial year, we expect a recovery for the year overall with an increasing benefit from the investments and innovations we have made over the last two years."