More bad news for Land of Leather
Leather furniture retailer Land of Leather has announced results for the third quarter of its financial year (April to March) that offer no comfort to its management team or investors.
The figures have shown a drop of 32.1% in like-for-like sales. The company admitted that it anticipated even more decline for the fourth quarter because of the economic climate and the poor start it had to the calendar year.
Land of Leather issued a profits warning after Christmas. It has been among the hardest hit in the UK retail sector because consumers, who are finding it much harder to obtain credit or borrow money, are avoiding expensive one-off purchases.
The company said in a statement that accompanied the results: “Since
the announcement of the interim results on March 27, market conditions
have remained challenging due to increasing demands on consumers’
disposable income and the continuing credit crunch.”
It said it would attempt to cut costs by cutting back on advertising, staffing and other costs, and conserving cash. It claimed action it has already taken will save it £11m a year.
It had bad news in April when bed retailer Sleep Depot went into administration. Land of Leather earned rent income of almost £5 million a year from leasing space to Sleep Depot in 71 of its stores.
The Financial Times commented: “It would be difficult for any investor to sit comfortably when sales are declining at such eye-watering rates. Conditions are savage for sellers of discretionary, high-priced goods and there is little evidence that circumstances are about to change.”
