Jessops' fourth profit warning prompts 30% slump in shares

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The Independent Online

The troubled high-street camera retailer Jessops issued yet another profits warning yesterday as tough trading conditions and the group's ongoing financial problems led to its share price falling by nearly 30 per cent.

In a trading statement teeming with disappointing figures, the company said that trading since the end of May, when it announced that sales for the six months to 30 March were down 5 per cent, had worsened. "Like-for-like sales in the 41 weeks ended 13 July are now down 5.7 per cent," the company said.

The board also conceded that annual losses would be worse than the £7.5m posted last year.

The company has now delivered four profits warnings since the start of last year when the stock traded at 150p.

The executive chairman, David Adams, who was brought in to restructure the group in May last year after the first three warnings, said that much of the retailer's present woes were due to an uncertain market, and that largely, the reorganisation of the company was complete.

The shares closed down 2.27p at 5.68p last night.

"It would be unfair to say that this is our fourth profits warning [because of the company]," he said. "Until the changes made last year, the company was losing sight of who its customers were and following some crazy policies. Now the restructuring has mostly been completed but with the market as it is we are taking two steps forward and then two back."

Mr Adams said that the company has taken a number of measures to get back on track. It has reduced the amount of stock it holds, closed 81 stores and abandoned attempts to sell items such as satellite navigation systems.

Mr Adams insisted that, despite yesterday's statement, he expects the Christmas shopping period to be strong.

However, sales at the group continue to be muted. The latest numbers, for the last three weeks, show an 11 per cent fall, despite the generally good weather. Indeed, Jessops' numbers are much worse than the average 0.4 per cent fall reported in general retail sales in June announced by the British Retail Consortium yesterday.