Liberty hit by war fears as shoppers stay away

By Nigel Cope,City Editor
Wednesday 26 March 2003 01:00
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Liberty, the loss-making department store in central London, has seen its trading hit by the closure of the Central Line, the congestion charge and the war with Iraq.

The landmark store on Regent Street has seen a drop-off in footfall in the past two weeks with last Saturday's trade devastated by the anti-war march. Nick Mather, the finance director of Liberty's parent company, Retail Stores, said: "The closure of the Central Line has definitely had an impact and the threat of war has deterred people from coming into the West End. As long as it doesn't go on too long we can react accordingly."

Mr Mather said sales in the two weeks were down 10 per cent on the previous two months. The store had previously been seeing a 40 per cent increase in footfall as a result of extensive refurbishments.

Other retailers, such as John Lewis and House of Fraser, have seen sharp falls in sales at their Oxford Street street stores as a result of the closure of the Central Line on the capital's underground railway system. Only Selfridges has bucked the trend with sales flat compared with last year.

Retail Stores has spent £9m on developing Liberty's Regent House building which overlooks Regent Street. In the past six months it has invested a further £1m on modernising the ground floor of the Tudor Building and opening an entrance into Carnaby Street. The next change will be the conversion of the fourth floor from offices into retail space in 2004.

Mr Mather said Christmas and new year trading had been strong and that the store plans to launch Liberty own-label clothes and accessories starting with a children's wear range later this year. Richard Balfour-Lynn, chairman, commented: "We believe we are reaching a very exciting state in Liberty's development, where for the first time in years, there is a clearly defined strategy aimed at creating both a strong brand and a profitable business."

The new chief executive, Iain Renwick, who joined last autumn from brand consultancy Imagination, has been improving other sections such as home furnishings. Mr Mather said: "We are starting to communicate that things have changed at Liberty."

Yesterday Liberty reported reduced losses of £1.5m in the six months to 28 December, compared with a deficit of £13m in the period the previous year. Sales rose nearly 10 per cent to £26m. Shares in the AIM-listed group were unchanged at 215p, valuing the company at £49m.

Retail Stores is two-thirds owned by the property company Marylebone Warwick Balfour. It made a profit of £2.1m in the six months to December compared with a loss of £88m in the previous year.

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