Moss Bros will have to cut its cloth on profits

Dec 6 2007 by Peter McCusker, The Journal

MENSWEAR retailer Moss Bros became the latest retailer to warn over profits after seeing weakened consumer spending on the high street.

The group said sales had taken a turn for the worse over the past seven weeks, despite an initially strong third quarter.

Fewer shoppers have been hitting the stores, dragging second half sales down 1.5% on a like-for-like basis so far, according to Moss Bros.

The firm said its key Christmas trading period may help boost figures, but cautioned it “seemed unlikely” full-year profits would match market expectations given the recent trading decline.

The group follows a string of retailers that have predicted trading gloom, with H Samuel parent Signet and furniture firm ScS Upholstery also recently issuing profit warnings.

High street sales data yesterday from the British Retail Consortium added to the sector’s woes, confirming that the three-month trend rate of growth in like-for-like sales fell to 1.8% in November from 2% a month earlier.

Moss Bros, which also trades under the Savoy Taylors Guild and Cecil Gee fascias, said it was streamlining its business in a bid to reduce costs and was keeping a tight control of stock levels in light of the slowing sales. It has also been leading a store revamp programme, refurbishing more than 30 sites across its 154-strong chain.

Philip Mountford, chief executive of Moss Bros, said: “Our sales performance in the last two months reflects the tough trading conditions in our markets.

“However, we enter this key period with well-developed retail plans, a good product range, better store environments and tight stocks.”

Moss Bros saw a turnaround in fortunes earlier this year, with like-for-like sales starting to climb after more than a year of difficult trading.

Last year it reported a 1.3% drop in like-for-like sales – its first fall in five years. Moss Bros was launched in 1851 as a second-hand store and created in its current firm from the merger of Moss Bros Hire and Cecil Gee in 1988.