Laura Ashley wins Persimmon deal
Article Date: Mar 19 2001Fully listed clothing and home furnishings retailer Laura Ashley has clinched a £1.2 million agreement with residential property developer Persimmon Homes. Elliott Davis reports.
Laura Ashley's deal with Persimmon will initially involve Ashley's team of 43 interior designers working on 60 Persimmon show-homes, but Ashley says there is potential for around 200 more. The deal may be small, compared with the £254.2 million sales analyst Ian MacDougall of house broker Williams de Broe forecasts for the current year, but he argues it will provide a useful shop window for sales elsewhere.
MacDougall sees it as continuing the recovery process which, he reckons, will enable Ashley to announce a turnaround for the year to January from losses of £4.1 million to pre-tax profits of £8 million. He predicts the company, which lost money for the three previous years, could boost profits to £10.5 million pre-tax in the current year.
A second contract to refurbish rooms and conference facilities at the Plaza Hotel on Hyde Park has also been confirmed, with 80 of 270 rooms due to be completed in April. This contract is again worth little directly - around £760,000 - but with branding for Laura Ashley in the Plaza's reception area and individual rooms, the company claims it is 'a great opportunity for on-site advertising', hinting that further deals with hotels might follow.
After losing money the last three years, MacDougall is confident Laura Ashley is moving in the right direction. He forecasts that full year figures to 31 January will see last year's £4.1 million loss turned into profits of £8 million - rising to £10.5 million 12 months on.
The shares edged up half a penny to 19.5p on the news.
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