17th Apr 2014 08:29
LONDON (Alliance News) - Haynes Publishing Group PLC said Thursday that it had seen revenue drop 7% in the thirteen weeks to February 28, 2014, hit by weaker trading in the UK and returns of obsolete inventory following its re-merchandising programme in the US.
However, year-to-date revenue was 4% ahead of the previous year, Haynes said.
The company completed a re-merchandising programme in its US business in January, which led to a return of obsolete inventory. It expects these returns to flow through its US revenue by the end of the year.
In the North American and Australian business revenue was down 5% on a like-for-like basis during the quarter, due to the inventory returns and weaker trading after Christmas hampered by weather conditions.
The Clymer and Intertec business Haynes acquired in September continues to perform within expectations, the company said.
Despite the weak quarter, North American and Australian revenue for the first nine months were 10% up on the previous year.
In the UK revenue fell 27% during the quarter, as weaker trading from automotive manuals and a focus on non-automotive higher margin manuals hit performance. In Europe revenue fell 1% in local currency.
The company expressed optimism that its focus on higher margin manuals would be positive for future UK sales.
At the beginning of March the company began to restructure its automotive editorial functions, which led to three voluntary redundancies in the UK. It expects this restructuring to cost GBP200,000, taking total restructuring costs for the year to GBP1.5 million.
However, it expects to see cost savings in the UK business of GBP600,000 during the 2014/2015 period, and GBP800,000 in 2015/2016.
Shares in Haynes were trading down 1.9% at 207.00 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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