Shop Direct cautious about growth but hamster toys doing well
September 24, 2009
Littlewoods owner, Shop Direct has declared that it expects earnings to slow down over the next year. The warning comes despite the fact the company has just announced a massive 182 percent rise in its underlying earnings for the year up to April 30th. Shop Direct also said that sales were up for the same period by 7.4 percent to £1.7 billion.
Shop Direct’s finance officer, Steve Makin said the company was being cautious in its outlook because of the current economic conditions. He said that the company had seen trading slow over the past twenty weeks and that trading was only just up by 1 percent on the same period last year.
Makin went on to say that the cautious predictions for growth were also due to the fact that Shop Direct had decided to review its lending practices to customers because of the current economic conditions. The company’s credit acceptance criteria are to be tightened up and this is likely to affect customers, the majority of whom take advantage of Shop Directs credit facilities.
Although Shop Direct says that it will be rolling out a big advertising campaign in late October across television, the internet and in the media it forecasts that trading over Christmas will be flat with the possibility of a small amount of growth.
Shop Direct bought the Woolworths brand in February this year and Makin has declared that he is very pleased with how the brand is coping in its new online position. He said that the site has attracted over four million visitors since July and that the hamster toys being sold on the website are flying out of the door.
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