Laura Ashley has slumped to an annual loss of more than £14m after a collapse in demand for its signature floral home furnishings.
The retailer said Brexit concerns had hit consumer confidence and stopped shoppers from making big-ticket purchases or starting big DIY projects.
At the same time, the housing market has slowed and house moves are key to the health of specialist retailers like Laura Ashley. As a result, like-for-like furniture sales were down 9% and demand for its decorating products, which include curtains and wallpaper, was down nearly 14%.
The chairman of Laura Ashley, Andrew Khoo, said all home furnishings retailers had been battling “difficult” trading conditions but conceded that problems with its own ranges meant sales had fallen short of its competitors.
Khoo, who succeeded his father as chairman last year, said the chain was adding contemporary ranges in an effort to improve performance. “We are confident in the resilience of our brand but we have a lot of work to do to make sure it stays relevant for the future,” he added.
Last year the retailer said it was closing a quarter of its 160 UK stores. So far six have shut and the company said more would close over the next 12 months.
Laura Ashley, which is listed in the UK but controlled by the Malaysian group MUI, has been struggling for some time.
The company, which issued two profit warnings earlier this year, made a pre-tax loss of £14.3m in the year to 30 June. Last year it broke even.
In the UK, which accounts for the lion’s share of the business, sales fell 5% to £223m, hurt by store closures and “considerable market uncertainty”.
Laura Ashleydates to 1953 when Laura and Bernard Ashley started printing fabric on their kitchen table in London. The Welsh designer had been inspired by a Women’s Institute exhibition at the Victoria and Albert museum on traditional handicrafts and wanted to make her own patchwork quilts . After reading up on fabric printing, the couple invested £10 in wood for a screen, dyes and some linen and printed their own.
Despite the problems in its furniture business, its clothing – which was a favourite of the Princess of Wales in the 1980s – is enjoying notable success as women embrace the trend for demure 1970s style dresses.
Earlier this year, Laura Ashley worked with Urban Outfitters on a venture that included cycling shorts, bikinis and scrunchies. Underlying sales at its fashion business, which accounts for about a fifth of sales, rose more than 9% – the second year in a row it has seen growth at that level.
