November 12, 2013 / 10:47 AM / 4 years ago

RPT-UPDATE 1-UK's New Look says warm weather holding back Christmas trade

* H1 pretax profit 13.8 mln stg vs loss of 13.6 mln stg

* Revenue 753.2 mln stg, up 6 pct

* Group like-for-like sales up 1.9 pct, UK up 2.6 pct

* CEO says can’t see company listing in next 12 months

* CFO Alastair Miller to step down

By James Davey

LONDON, Nov 12 (Reuters) - British fashion retailer New Look cautioned that trading in the key Christmas quarter had got off to a slow start with unseasonably warm weather since the end of September making it harder to sell winter coats, jumpers and boots.

“We’ve had (an) unseasonal warm October and beginning of November and it’s pretty tough out there,” Chief Executive Anders Kristiansen told reporters on Tuesday, though he said the firm had no plans for pre-Christmas discounting and was still optimistic it could have a good third quarter.

Britain’s retailers have generally enjoyed a better year as the economy has moved back into growth, though executives see continued pressure on consumers with wage rises lagging inflation.

Last week Marks & Spencer, Britain’s biggest clothing retailer, reported a ninth straight quarterly fall in underlying general merchandise sales.

Shares in M&S, Next and Debenhams were all lower on Tuesday.

“As yet we are not seeing any benefits of economic recovery feed through to our customers’ pockets,” said Kristiansen.

New Look, owned by private equity groups Apax and Permira, and founder Tom Singh, swung to a first-half profit driven by revenue growth, particularly online, as well as reduced discounting and cost savings.

But Kristiansen said he could not see New Look, which has net debt of 1.09 billion pounds ($1.74 billion), joining the current rush for stock market listings.

“I‘m not the shareholders, basically it’s up to them to decide. But I can’t see us doing an IPO in the next 12 months.”

New Look pulled a planned flotation in 2010 amid turbulent financial markets.

The firm, which trades from over 1,100 stores across 32 countries, made a pretax profit of 13.8 million pounds in the 26 weeks to Sept. 28, reversing a loss of 13.6 million pounds in the same period last year, on group revenue up 6 percent to 753.2 million pounds.

Group sales at stores open over a year rose 1.9 percent, with UK like-for-like sales up 2.6 percent. The firm’s online sales jumped 78.8 percent, reflecting improved functionality on its website and better delivery options.

Gross margin at group level rose 40 basis points due to tighter control of stock and fewer markdowns.

New Look slumped to a loss in 2011-12 but made a small profit in the 2012-13 year.

The firm said it sees a “huge” international opportunity and plans to open its first store in China by spring 2014 and have about 20 by the end of that year.

A big push is also planned into Germany, Russia and Poland.

“All of them, maybe apart from Poland, can be as big as the UK, or significantly bigger,” said the CEO.

New Look also said Alastair Miller, its chief financial officer, will leave the firm when a successor is appointed.

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