Laura Ashley plans to add "a selection of more competitively-priced products" to its furniture range, in light of a -8.2% YoY sales drop in the category, with LFL sales down -4.1%, over the year to 30th June 2018.
"This is our most highly-priced category," reads the retailer's results statement. "Given the softer consumer confidence at this juncture, some of our customers have deferred the more expensive purchase of a new settee or bed."
Home Accessories, Laura Ashley's largest category (accounting for 34% of its business, and furniture for 29%), saw sales fall by -3.6% over the same period, yet its LFL sales were up +2.9% YoY
Total group sales were £257.2m (down from £277.0m in 2017), and total LFL sales fell by -0.4%. However, LFL ecommerce sales grew by +4.1% to £59.7m (from £57.3m in 2017), and now represent a quarter of its retail revenue.
Operating expenses of £91.7m were recorded for the year (down from £98.3m in 2017), a reduction attributable largely to a net reduction of stores.
Laura Ashley also separately announced that it has entered into a conditional agreement to sell its property in Singapore, which was purchased in June 2015 with a view to making it the retailer's Asian headquarters.
The statement reads: "While expansion into the Asian market continues to be a priority, the retail environment, both domestically and internationally, has changed, and the board believes that this is an appropriate time to dispose of the property in Singapore."
Company chairman Tan Sri Dr Khoo Kay Peng comments: "Although the proposed sale has led to an impairment charge for the group, on completion of the disposal, group net debt will be significantly reduced and cash flow will be strengthened.
"As set out at the time of the interim results, the trading environment for the first half of the year was challenging, and the board expected these difficult trading conditions to continue into the second half of the year. This proved to be the case and, given the softer trading environment for the year ended 30th June 2018, we are disappointed to report a fall in profits. Continued margin pressure and the impact of a changing retail landscape have contributed to the overall reduction in profit before tax.
"We are, however, encouraged by the progress and continued growth being made by our online business, and will be launching a new digital platform in the weeks to come."