City Safestyle-watchers were today forecasting a fundraising effort after the retailer declared it intends to ‘engage with stakeholders to strengthen the balance sheet’ in its second profit warning in less than two months
Shares had fallen 48.8% by noon in the wake of the warning, where it blamed unseasonally wet and warm weather for ‘compounding the macroeconomic factors that influence current market demand levels’.
There was some good news among the bad with Fensa figures showing its market share now topping 8% and an 11% drop in order intake compared with industry indications of a 24% decrease in online search stats.
The retailer is stepping up online marketing as well as discount management and its finance offer, but the report adds: “The impact of an industry wide fall in volumes due to market conditions is combining with higher lead generation costs and a lower average frame rate than expected.”
Management have taken further steps to mitigate weaker demand, including reduced factory shifts and voluntary pay and fee waivers for the Board, it adds but concludes:
“Our best estimate is that, whilst we expect demand levels will pick up versus current levels in line with seasonal trends, we believe it is likely to be below previously expected levels. Consequently, the Board now expects the Group’s revenue for 2023 will be between £140m – £142m and consequently, underlying loss will be in the range of £(9.5)m – £(10.5)m.
