Quiz, the Glasgow-headquartered fashion retailer, has warned its profit and revenue will be lower sending its shares tumbling.
The firm, which has 71 stores and 169 concessions in the UK as well as a major online presence, said underlying earnings would be about £8.2 million for the full year. Revenue is also set to fall short of market hopes, coming in at some £133m.
In an update for the six weeks to 5 January, the group said revenue was up 8.4 per cent on the same time last year but this marked a slowdown on last year’s 31.9 per cent growth, despite higher-than-expected discounting.
It noted that the retail trading environment had been particularly challenging in November, though had shown some improvement towards the end of the period.
Chief executive Tarak Ramzan said: “Against the backdrop of challenging trading conditions over recent months, Quiz has delivered further revenue growth over the Christmas period driven by the performance of our own websites.
“However, the growth and the margin achieved have been below our initial expectations and, consequently, the board considers it appropriate to revise its sales and profit expectations for the current year.
“We remain confident about Quiz’s long-term potential as an omni-channel fashion brand with a clear customer focus.”
John Moore, senior investment manager at Brewin Dolphin Scotland, said: “While Quiz’s sales grew year-on-year, there are some red flags in this latest set of results.
“Anticipated revenues have been revised down, while investment in marketing and personnel, as well as discounting, has eaten into margins. It is undoubtedly a tough trading environment for retailers, as we’ve seen with some other company’s results.
“But, the City’s main concerns about Quiz are over its ability to generate enough cash to be self-sufficient and handle shocks from the wider sector.”