Retailers report struggling profits

The fragile state of the UK economic recovery was underlined today after Halfords and Carpetright served a double dose of retail woe.







The recognised retailers, who both warned full year profits would fall short of previous expectations, joined a list of struggling UK companies to have flagged challenging conditions in recent months.



The gloom-laden climate has seen the likes of entertainment group HMV, Currys parent Dixons Retail and department store owner John Lewis report disappointing sales in 2011.



The sentiment towards the industry is reflected on the stock market, where retailers' shares have suffered from consistent declines.



A key survey earlier this month offered some hope as it revealed the UK services sector - the biggest in the UK economy - grew at its fastest pace for more than a year in March.



But the precarious position the retail sector finds itself in will trouble Chancellor George Osborne, who has pinned his hopes for recovery on the private sector, and the Bank of England, which is faced with balancing soaring inflation and sluggish growth.



In a third quarter update, Halfords warned profits would be lower than expected as decent cycle sales were overshadowed by a poor performance in car maintenance.



The group, which has 464 stores in the UK and Ireland, said it expected full year pre-tax profits to be between £124 million and £127 million, down from a previous range of £127 million to £135 million. Last year, the company reported pre-tax profits of £109.7 million.



Looking further ahead, chief executive David Wild said trade would continue to be difficult.



"It's a very uncertain environment," Mr Wild said. "We have to trade the business as hard as we can. When there will be a recovery in consumer spending, it's difficult to call."



Carpetright issued its second profits warning of the year in a further blow for the floor coverings firm as it battles weak consumer confidence.



The retailer's shares dived 7% after it warned profits for the year to the end of this month were likely to be no better than the level achieved in the 2008/09 financial year, when it made a surplus of £17 million.



It has seen no let-up in grim trading conditions as households put off major purchases in the current uncertain economic climate.



Embattled retailer HMV earlier this week issued its third profits warning this year as trade failed to pick up since Christmas, while John Lewis last week reported its worst weekly sales in nearly two years.



Marks & Spencer bucked the trend yesterday with better-than-feared sales for the 13 weeks to April 2, but the 0.1% like-for-like growth still represented a sharp slowdown from previous quarters.



The FTSE 100 Index fallers' board was full of retailers today, including Next, B&Q parent Kingfisher, Marks & Spencer and designer label Burberry, as traders avoided the troubled sector.

PROMOTED VIDEO
News
Gardai wait for the naked man, who had gone for a skinny dip in Belfast Lough
newsTwo skinny dippers threatened with inclusion on sex offenders’ register as naturists criminalised
Sport
Van Gaal said that his challenge in taking over Bobby Robson's Barcelona team in 1993 has been easier than the task of resurrecting the current United side
football
Arts and Entertainment
The Great British Bake Off 2014 contestants
tv
Life and Style
tech
Arts and Entertainment
filmThe Battle of the Five Armies trailer released
News
news
Arts and Entertainment
Beast would strip to his underpants and take to the stage with a slogan scrawled on his bare chest whilst fans shouted “you fat bastard” at him
musicIndie music promoter was was a feature at Carter gigs
Arts and Entertainment
Story line: Susanoo slays the Yamata no Orochi serpent in the Japanese version of a myth dating back 40,000 years
arts + entsApplying the theory of evolution to the world's many mythologies
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Extras
indybest
News
Performers dressed as Tunnocks chocolate teacakes, a renowned Scottish confectionary, perform during the opening ceremony of the 2014 Commonwealth Games at Celtic Park in Glasgow on July 23, 2014.
news
Life and Style
Popular plonk: Lambrusco is selling strong
Food + drinkNaff Seventies corner-shop staple is this year's Aperol Spritz
Life and Style
Shake down: Michelle and Barack Obama bump knuckles before an election night rally in Minnesota in 2008, the 'Washington Post' called it 'the fist bump heard round the world'
newsThe pound, a.k.a. the dap, greatly improves hygiene
Arts and Entertainment
La Roux
music
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Project Manager,Conduct Risk,London,£5-600pd

£500 - £600 per day + competitive: Orgtel: My client, a leading bank, is curre...

Senior Fund Administrator - Edinburgh - £22 p/hr

£20 - £22 per hour + competitive: Orgtel: Senior Fund Administrator, Top Four ...

Entry Level Fund Accountant (Edinburgh)

£17 - £20 per hour: Cameron Kennedy Recruitment: My client, one of the worlds ...

SQL DBA/Developer

£600 per day: Harrington Starr: SQL DBA/Developer
 SQL, C#, VBA, SQL Server, ...

Day In a Page

The children were playing in the street with toy guns. The air strikes were tragically real

The air strikes were tragically real

The children were playing in the street with toy guns
Boozy, ignorant, intolerant, but very polite – The British, as others see us

Britain as others see us

Boozy, ignorant, intolerant, but very polite
Countries that don’t survey their tigers risk losing them altogether

Countries that don’t survey their tigers risk losing them

Jonathon Porritt sounds the alarm
How did our legends really begin?

How did our legends really begin?

Applying the theory of evolution to the world's many mythologies
Watch out: Lambrusco is back on the menu

Lambrusco is back on the menu

Naff Seventies corner-shop staple is this year's Aperol Spritz
A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on