June 12, 2014 / 11:36 AM / 4 years ago

UPDATE 1-Stockmann cuts 2014 outlook after weak May sales

(Adds detail, background)

HELSINKI, June 12 (Reuters) - Finnish department stores and fashion chain Stockmann cut its outlook on Thursday for the second time in two months, partly due to weaker-than-expected demand at domestic stores.

The Finnish economy has shrunk for two straight years, reflecting weak exports and a downturn elsewhere in Europe, and lately the weakness has spread to private consumption, with retailers feeling the impact.

The company’s troubles were compounded by weak sales in Russia, where the weaker rouble has made imported products more expensive. Russia is Stockmann’s second-biggest market.

Stockmann said May sales fell 8.3 percent from a year ago and warned that without a considerable change in the market environment in the latter half of the year, operating profit would end up significantly weaker than in 2013, marking a second outlook cut in two months.

On April 29, the company had said it expected 2014 operating profit would not exceed the figure for 2013.

“Demand of non-food products has continued to be weaker than expected in the Finnish market during the second quarter,” Stockmann said on Thursday, adding that a weak Russian rouble was also hurting results.

Stockmann’s local rival Kesko said earlier on Thursday its May sales fell 5.9 percent from the same month a year earlier.

Stockmann shares were down 2.5 percent and Kesko’s 2.4 percent by 1125 GMT. (Reporting by Jussi Rosendahl and Sakari Suoninen; Editing by Jason Neely and David Holmes)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below