Peacock posts 24% profits rise

British high-street retailer Peacock today shrugged off the challenge of supermarkets in the discount clothing market by posting a 24% hike in half-year profits.

The Cardiff-based group said like-for-like sales rose 3.4% as shoppers increasingly chose “value” ranges over more expensive ranges sold by high street rivals.

Profits of £14.3m (€20.6m) during the 26 weeks to October 2 were driven by strong performances at its 411-strong chain of Peacocks stores and the newly-acquired Fragrance Shop.

Trading at Bon Marche, which sells clothes for women aged 45 and above, was disappointing by comparison with same-store sales down 7.2% after poor weather kept shoppers away.

The group said the introduction of clothing ranges that put a greater emphasis on contemporary styles and quality had helped its Peacocks stores to counter the threat from supermarkets such as Asda and Tesco.

Like-for-like sales improved by 9% on the back of strong demand for womenswear and footwear, while refurbished stores continued to perform significantly better those awaiting conversion.

Peacock refitted 57 of its stores in the period, opened 15 outlets, relocated one and closed one.

Some 68% of the chain is now trading in the new format.

At the same time, like-for-like sales at the Fragrance Shop were 9.5% higher than a year ago during a period when demand is traditionally low.

The Fragrance Shop was acquired in June and eight new stores have already been opened, with the group on track to meet its target of adding 20 new stores over the full year.

Investors were reassured that turnaround measures at Bon Marche were continuing to bear fruit, with like-for-like sales restored to growth in the final weeks of the period.

Peacock said it had plugged gaps in its product range by overhauling its buying and merchandising teams, while old stock was kept under tight control.

Trials were also taking place of a new shop format at the 23 stores opened in the period and five existing outlets, the group said.

In addition to the 411 stores trading as Peacocks, the group currently owns 336 Bon Marche outlets and 36 branches of the Fragrance Shop.

Chairman Gavin Simonds said he was confident of another year of “good growth and progress” as he outlined his vision of a further expansion in the store portfolio.

He said: “There are real opportunities for growth in all our businesses.

“We currently estimate ultimate scope for at least 700 Peacocks, 550 Bon Marche and 150 Fragrance Shop branches in the UK.”

Shareholders are in line to receive an interim dividend of 3p, which was up 20% on a year ago and reflected the confidence of Peacock in its future prospects.