Laura Ashley’s Singapore sling eases profit wipeout

The City heaved a sigh of relief on Wednesday despite a dive in profits at Laura Ashley as it plans to offload property overseas to bolster its coffers.

The fashion-cum-hotels business, which also sells bed linen and furniture, saw pre-tax profits virtually wiped out at £100,000 for the year to June 30, down from £6.3 million previously.

Sales fell 7% to £257.2 million, while same-store sales dropped 0.4%.

But finance chief Seán Anglim said this was “not by any means disastrous”. “The market has been difficult for everybody,” he added.

There were some bright spots too. Its fashion same-store sales were up 9.7%, after it hired a fashion director last year to turn around its struggling clothing division. Its online revenue also grew by 4.1%.

“We are encouraged by the results,” added Anglim, amid the woes engulfing the High Street.

Toys R Us and Maplin went bust this year, while House of Fraser, which collapsed into administration this month only to be bought by Mike Ashley’s Sports Direct hours later, Debenhams and New Look are struggling.

The retailer said it was offloading its property in Singapore for £30 million to bring cash back into the business.

If the sale of the property is approved by shareholders it will help Laura Ashley narrow its debts.

It will close five of its 160 stores in Britain next year.

The shares were up 9.9%, or 0.43p, to 4.75p, albeit from a low base. The stock was trading at 26.6p five years ago. The retailer warned over profits in February, the third time in 12 months, and had to ditch its dividend.

Laura Ashley is pinning its hopes on its hotels business — it has two — as it will continue to franchise the model at home and overseas.