ASHLEY STOCK: SLIGHT UPTICK
LONDON — Share price of Laura Ashley Holdings PLC recovered only slightly Friday after a bashing the day before on the London Stock Exchange.
The stock gained 3 cents (2 pence) to close at $1.72 (1.06 pounds), after sliding 67 cents (41 pence). or 28.3 percent, Thursday.
The sharp drop was in reaction to a warning from the company that profits in the current fiscal year would be hit by heavy markdowns on its spring apparel collection.
That warning came even as Laura Ashley reported a 44.3 percent increase in after-tax profits to $16.4 million (10.1 million pounds) on a 2.7 percent drop in sales to $532.7 million (327.6 million pounds) in the year ended Jan. 25. Earnings per share rose 44.1 percent to 7 cents (4.3 pence).
In a statement, Ann Iverson, chief executive, noted the firm is confident about its strategies, but there will be a need “to take markdowns on the current garment collection as a result of both delays in first half 1997 store openings and overly aggressive sales targets. This will affect first-half trading and, as a result, the outcome for the full year, although ahead of last year, will be below current market expectations.”
Analysts, who had been forecasting a continued turnaround at the company, immediately downgraded their profit forecasts for the current year to about $29.3 million (18 million pounds) from the originally expected $40.6 million (25 million pounds).