Jacques Vert warns loss will rise to pounds 9m

Click to follow
The Independent Online
Jacques Vert, the troubled women's clothing retailer, said yesterday it expected to make a loss of more than pounds 9m for the year to May. The loss is much higher than the market had expected and the group admitted it would be forced to record a big stock write-down after discovering problems during its annual stock count.

It is another blow to the clothes retailer which has been beset by problems over the past few years. Jacques Vert warned in May that disappointing wholesale orders and the decision by House of Fraser, the department store group, to terminate concessions at all 32 of its outlets would plunge the group into the red. House of Fraser dumped the group to concentrate on younger lines after disappointing sales of Jacques Vert ranges in its stores.

The latest profit warning coincided with the resignation of the finance director, Phillip Ashworth.

Jacques Vert's problems stem from a move into the casual market. The group announced plans earlier this year to attempt to halt its alarming slide. These included splitting its retail and wholesale business and selling its Tyne & Wear factory.

It is also developing a joint venture with Littlewoods, which recently bought a sizeable stake in the group, to publish an up-market ladieswear catalogue.

However Jacques Vert admitted its attempts to save costs by sourcing more products overseas had run into difficulties, putting further pressure on margins.

The group has now made five profit warnings in the past two years. Industry sources believe there is no quick fix to Jacques Vert's problems and it is likely to make another large loss in the current year.

There had been mounting speculation that Jacques Vert was in danger of breaching its banking limits. However the group said it was still operating within its borrowing limits and moved to calm shareholder fears yesterday by saying it was in touch with its bank, Midland, to made sure it had enough money to complete its restructuring plan.

The company said like-for-like sales since May were ahead of expectations and the shares edged up 0.5p to 25p.