Bottom Line: Ideas in Storehouse

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The Independent Online
A DEPARTING boss can take the credit for his company's performance for the year after he leaves, according to Keith Edelman, chief executive of Storehouse since last August. That means the group's 48 per cent rise in pre-exceptional profit and the first dividend increase since it was cut from 8.8p to 5p in 1990, is all down to his predecessor, David Dworkin. Mr Edelman will be judged on where Storehouse goes from here.

On that, he has plenty of ideas. At BhS, he is working with suppliers to ensure that customers get what they want, but with shorter lead times. He is freeing more storage space for selling, planning to open stores in 60 unrepresented areas and boosting the marketing spend.

There is much to go for. At 400, its supplier numbers are similar to Marks & Spencer, but the amount put through each is less than a fifth as high - one reason its margins, although up from 6.3 to 7.5 per cent, are almost a third below Marks'. At Mothercare, it has succeeded in winning back business from upstarts like Adams, but the 3.6 per cent margin is still inadequate.

The question is, will he succeed? The City is clearly sceptical - on forecasts of about pounds 87m, it stands on a multiple of 15, compared with 16 for the sector as a whole. But given how intractable BhS's problems have proved in the past, such scepticism is justified.