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Bonmarché calls it a day for its menswear experiment after H1 poor results

By Angela Gonzalez-Rodriguez

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Business |ANALYSIS

Womenswear chain Bonmarché will discontinue its menswear experiment after profits for the first half of the year came in lower than expected. The British retailer reported a dip in interim pre-tax profits for the first six months of 2016 compared to the same period the previous year.

Interim profits fell from 5.4 million pounds last year to 2 million pounds, following a like-for-like sales dip by 8.6 percent in the six months to September, 24. Meanwhile, Bonmarché’s total revenue fell from 97 million pounds last time to 93.1 million pounds, while its online sales fell by 1.1 percent.

“It is a disappointing result for the first half. It is a really tough market, but that aside there are some elements of our own internal execution that could have been better,” summed up Stephen Alldridge, finance director of Bonmarché, reported the ‘Financial Times’.

Bonmarché discontinues menswear as scales back from “peripheral activities”

On another note, Bonmarché announced Tuesday that it will end its menswear trial after the Christmas season, as new chief executive Helen Connolly scales back “peripheral activities” to focus on modernising and simplifying the business.

“After testing the menswear trial during the late autumn 2014 season, with a limited range in 50 stores, the company has decided to discontinue the menswear trial once the Christmas season collection is sold through,” advanced a company’s spokesperson.

The ‘Yorkshire Post’ recalls that Connolly, who became CEO in August, said Bonmarché has significant potential to keep growing as a retailer serving the 50-plus women’s value clothing market.

The company’s CEO made these remarks during a press conference, after revealing falling profits before tax and revenues for the first half of the year, burdened with a weather that turned to be “a major variable which adversely affected performance during the first half”.

Unseasonal weather and BHS’ administration hit Bonmarché’s trading during the first half

In this regard, the company noted that “Summer 2016 was characterised by weather which was generally too cool during May, June and July to create demand for seasonal basics such as t-shirts, and then the warm weather during September delayed sales of product, such as coats, planned for the beginning of the autumn/winter season. “However, the warm September weather resulted in effective clearance of much of the remaining summer stock, albeit at discounted prices.”

Addressing the difficult conditions for retailers on the high street, Bonmarché recognised it was also affected by BHS going into administration in April. “Over the following months it cleared its residual stock at discounted prices prior to closing its stores, which affected Bonmarché’s sales, particularly in late April and May 2016,” reported the company.

Looking ahead, the retailer issued a statement adding that “We believe that the clothing market generally will continue to be challenging. Recent trading has shown an improvement since September, reflecting better ranges and more seasonally appropriate weather, which has supported demand for coats and knitwear in particular.”

“The board’s view is therefore that, in line with the guidance issued in September, the group’s full year PBT (profit before tax) is likely to fall within a range between 5.0 million pounds and 7.0 million pounds. “Despite the external challenges, we are confident that Bonmarché remains unique in its ability to serve the needs of its target market.”

Image: Bonmarché

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