24th Mar 2016 08:54
LONDON (Alliance News) - Findel PLC on Thursday said it expects to report a full-year pretax profit before exceptional items in line with current market expectations but disclosed a slew of one-off provisions it will have to book across the business.
The home shopping and education supplies business said it has achieved an improvement in the recent sales performances of its two remaining businesses Express Gifts and Findel Education. It sold its struggling third business, sports retailer Kitbag, in February.
In the last nine weeks of the year ending March 25, Findel said Express Gifts achieved product sales growth of 8.5%, compared with 2.2% for the full year. Findel expects the division to report an operating profit for the full year which is GBP2 million lower than the GBP33.6 million achieved in the prior year, reflecting a currency impact of GBP3 million.
Findel, however, said it will have to increase its redress provision related to Express Gifts to GBP10.0 million from GBP2.0 million. The provision relates to a financial services product Express Gifts had offered.
Findel Education saw sales decline by 7.4% in the nine weeks, compared with a 7.8% decline for the full year. However, active customers for Findel Education stabilised after several years of decline while the higher margin classroom brands delivered a strong performance, Findel said, adding that it expects the division to report an operating profit which is GBP1 million below the GBP4.2 million achieved the prior year.
The company also sai it expects to book a GBP6.0 million to GBP7.0 million one-off costs for the Education business related to the vacation of its Enfield property.
Findel will also recognise one-off charges related to its refinancing in November and the sale of Kitbag, though it said exceptional related to the Kleeneze Ltd business it has now sold has been largely credited back.
"Looking further ahead, we remain confident that Express Gifts' strategy will yield significant medium-term profit growth and Education is well placed to benefit from the actions we are taking," Executive Chairman David Sugden said in a statement.
Shares in Findel were trading down 5.5% at 175.00 pence on Thursday morning.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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