Etam warns on yearly earnings after weak Q4

PARIS, Jan 22 (Reuters) - French lingerie and womenswear retailer Etam Developpement (TAM.PA: Quote, Profile, Research, Stock Buzz) said on Tuesday full-year 2007 operating profit would fall after it reported a weak end to the year in its French and Chinese businesses.

"The group's unfavourable end-of-year sales performance and difficulties in China will result in a fall in operating profit," Etam, which runs stores under its own brand as well as the 1.2.3 banner, said in a statement.

Etam said fourth-quarter sales fell 3 percent to 258 million euros ($374.1 million), leaving annual sales up 4.8 percent at 1.01 billion. Nine analysts polled by Reuters Estimates had on average forecast annual sales of 1.03 billion.

Etam said like-for-like fourth-quarter sales in its core French domestic market fell 3.5 percent to 174 million euros.

"The slowdown in consumer spending over the period thwarted the positive dynamic seen since the second quarter as a result of the repositioning of the group's ready-to-wear collections," Etam said. (Reporting by Nick Antonovics; Editing by David Holmes)