Beales Sees Losses

Regional department store group Beales has reported a fall in sales and profits after a year of "intense competition, price deflation and more cautious consumer spending in a very competitive high street". In the year to October 30 2004, Beales saw turnover fall 5.5 per cent to £65.3m, with pre-tax profit down to £0.26m from £1.08m. Gross sales fell by only 4 per cent across the year to £109.6m, down by 5.2 per cent in the first half and by 2.7 per cent in the second half as business plan changes implemented by the group took effect. Gross margin improved from 51.24 per cent to 52.41 per cent.

The group said its first half was disappointing after a very challenging Christmas 2003 trading period. However, the second half saw a more positive sales trend, helped by an improved merchandise selection. The introduction of young womenswear, now in all the group's 12 stores except Winchester, has been particularly successful. The exclusive b. womenswear range has performed to expectations, supporting the branded fashion offer. The refocused trading strategy includes improved product range, shop keeping standards and the store refurbishments. The current year will see the introduction of new departments including audio/TV, childrenswear and arts & crafts into selected stores.

Chairman Mike Killingley said: "We continue to believe that the actions we have taken over the past two years to improve our product range and our stores is making a difference and will be particularly beneficial when the trading environment improves." He added: "The difficulties facing us serve to reinforce our corporate objectives of driving sales growth, improving product selection and profit margins, more focused direct marketing and continued concentration on stock management controls and cost reduction. We hope to build on our improving sales trend, however, given the increasingly challenging trading environment, we do not anticipate dramatic improvements in the present climate."