(Reuters) - Bonmarche Holdings Plc shares plunged 31 percent in light early trading after the women’s fashion chain warned of a bigger full-year loss and reported quarterly sales below its expectations, as it discounted heavily to clear unsold apparel.
With Britain heading for a potentially messy and yet unclear exit from the European Union, consumer spending is drying up, forcing retailers to sacrifice profits for sales.
The company, which warned in December that it could report losses this year, said on Tuesday that it expects underlying pretax loss for the year of between 5 million pounds ($6.63 million) and 6 million pounds.
It had previously expected its results to range from break even to a loss of 4 million pounds.
“We believe that the recent downturn in trading is a consequence of the demand for transitional ranges, between winter and spring, having been satisfied during January and February,” the company said in a statement.
Retailers are also struggling to keep pace with consumers moving online for shopping, meaning many are weighed down with excess and costly store space and unsold items.
Bonmarche, which mainly sells blouses, shirts, jeans and skirts at affordable prices to women aged over 50, said its spring collection benefited from a spell of warm weather in February.
Based on the “positive early reaction”, the company said it was backing its expectation for the fiscal year 2020.
Reporting by Pushkala Aripaka in Bengaluru; Editing by Saumyadeb Chakrabarty and Anil D'Silva