Topshop's Philip Green expects major price cuts in battle for Christmas sales

Topshop boss expecting a swathe of festive discounts as his Arcadia group reports a 3% fall in annual profit

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The Independent Online

Topshop tycoon Sir Philip Green has predicted a high street discount war this Christmas as retailers attempt to win back shoppers after a mild autumn.

Forecasting a swathe of festive discounts among the retailers, Sir Philip said: “It’s going to be very promotional. That’s already clear from the newspaper ads. Anybody that says they have not been affected by the mild season would not be telling the truth.”

Arcadia vehicle Taveta Investments posted a fall in pre-tax profits to £143.1 million in the year to August 30 on £2.7 billion in sales, down from £148.1 million last year despite a 1.6 per cent rise in like-for-like sales at stores open longer than a year.

 

However, since the year-end on August 30 like-for-like sales fell 1.2 per cent as the mild weather dented its performance. The weather woes echoed similar travails at Next, Marks & Spencer and Superdry owner SuperGroup, which all felt the force of a mild autumn as they struggled to shift winter clothes.

“When people are walking down the street in November in a T-shirt it’s clear it’s unusual,” said Sir Philip. “We manage our stock very carefully and there have been no disasters.” He added that home and gift products within its BHS shops had not been affected by the warm conditions.

Arcadia’s fall in profits came as the empire — which includes TopShop, Dorothy Perkins, Wallis, Evans, Burton and Miss Selfridge — took a bet on future growth through investing.

Green ploughed £105 million into expanding in the US, refreshing shops and beefing up the online offer. The retail group will splash out £94.5 million this year, including on its first Dutch store, IT systems and revamping its West End headquarters.

The fashion group stepped up its efforts to push Topshop and Topman stateside last year, with three new company-owned shops, including a debut on New York’s shopping mecca, Fifth Avenue, to complement its shops within department store group Nordstrom.

BHS remains in the red, with losses widening despite a rise in sales. However, the group said its three stores selling food had performed well.

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