Market Report: Laura Ashley profit and shares jump


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The Independent Online

The British retailer best known for its chintzy fabrics and dresses has made a dramatic return to fashion, as profit and shares jumped yesterday.

Laura Ashley blossomed at the top of the FTSE All-Share index as it revealed sales of its homeswares soared in the six months to 26 July. Overall sales advanced 4.9 per cent to £144m, with pre-tax profits up 15 per cent to £8.5m.

Malaysian owner MUI Group has worked on the turnaround of the business since it bought it in 1998. MUI owns 35 per cent of the business and MUI chairman Khoo Kay Peng owns another 25.5 per cent. The shares soared nearly 8 per cent, or 2p, to 27.25p.

The wider market failed to match Thursday’s 14-year intra-day high and fell back on weak mining stocks and news that the US job figures were below expectations.

The FTSE 100 declined 22.87 points to 6855.1. It is still up 1.5 per cent so far this year and analysts expect it to reach an all-time high at some point this year.

BP recovered after a sell-off on Thursday, when news emerged it could face new larger fines of up to $18bn in the US over the Gulf of Mexico oil disaster, after it was declared to have acted with “gross negligence”. The shares fell 5 per cent on the news but yesterday were top of the table – up 11.8p to 466.8p.

Miners were hit by the fall in precious metal prices and Mexican silver digger Fresnillo regressed 41.5p to 868p, while gold miner Randgold Resources dipped 203p to 4737p.

Royal Bank of Scotland was knocked by a note from Berenberg Bank which declared the state-backed lender is 30 per cent overvalued due to “legacy risks”. They rated it a sell and shares declined 7.9p to 347p.

Fizzy drinks bottler Coca-Cola HBC dropped 53p to 1416p after Goldman Sachs cut its rating to neutral and noted the risks it faces in Ukraine and Russia.

Back on the small cap index, the struggling European economy hit civil engineer Low & Bonar, which issued a profit warning amid slowing European construction and slower-than-expected order intake in Saudi Arabia. Pre-tax profit for the year to December will be between £25.3m and £26.5m, compared with the previous year’s £25.3m. It tumbled 15.25p to 66p.