SCS pulls dividend after poor Christmas

Furniture chain ScS Upholstery said today it was scrapping the launch of four new stores and not paying a dividend after a slump in Christmas trading.

The Sunderland-based group had planned to open five new stores before July, but after posting a 16% drop in like-for-like sales in the three weeks since Boxing Day it said just one would now open.

ScS also said that a refurbishment programme for its 95 UK stores was being postponed due to the poor results, which it blamed on the credit squeeze and pressures on consumer spending.

Management warned that “no relief” in the situation was expected before the firm’s financial year-end in July.

The retailer’s results come two weeks after rival Land of Leather issued a profits warning, telling investors that sales in the run-up to Christmas fell by 25.5%.

ScS said: “We see no relief from the credit squeeze and pressures on consumers’ disposable income for the remainder of the financial year and although our comparable numbers are softer, it is unlikely that we will see any significant improvement on our year to date like-for-like sales performance.”

Shares in the firm were down 13% on the back of the update.