Etam chain gets stylish figures

ETAM, the women's fashion chain which fought off a pounds 121m bid last year, made pounds 1.2m in its traditionally weaker first half, up from just pounds 35,000 last year.

Despite continuing weak demand from customers, Etam was able to increase sales by 7.4 per cent to pounds 105.8m in the 28 weeks to 15 August.

Etam said like-for-like sales were 7.2 per cent ahead, while sales per square foot were up from about pounds 270 to pounds 295. It said its market share continued to rise, to 3 per cent against 2.9 per cent last year and 1.4 per cent in 1986.

The company's profit was struck after deducting the pounds 461,000 cost of disposing of unprofitable shops. The group's capital expenditure was also up on last year, from pounds 1.2m to pounds 4.2m.

Etam has had no further contact with Oceana, the South African-owned investment company which retains a 34 per cent stake after its failed 185p-a-share takeover attempt. Oceana is the vehicle of Stanley Lewis and his son Michael, who control and run Foschini, a large South African fashion chain.

Etam has resisted the Lewises' demands for boardroom representation. The South Africans have argued that their experience from Foschini could improve Etam's management, particularly in the use of electronic point-of- sale equipment.

However, Rodney East, Etam's managing director, and his team are held in high esteem in the City. Etam's internal information systems are regarded as highly effective, and the company has some of the shortest lead-times for ordering stock in its industry.

Etam said yesterday that it is achieving a stockturn of 13 times, much more than rival retailers Sears (6.8), Burton (7.2), Storehouse (7.5) and Next (8.7).

The company, which is chaired by Sir John Nott, the former Defence Secretary, has only negligible borrowings of pounds 1.6m and expects to have eliminated this by the year end. Sir John said: 'The most significant part of the trading year is yet to come, but the board remains confident that the out-turn for the full year will be satisfactory.'

Etam increased its interim dividend by 10 per cent to 1.65p a share.