UK kitchenware brand ProCook posts weaker Black Friday, early Christmas sales (updated)
14/12/2022 09:40
(Adds details, background)
Dec 14 (Reuters) - British kitchenware brand ProCook Plc
PROC.L said on Wednesday its sales from Black Friday and early
Christmas shopping were weaker than last year, as customers cut
down on spending amid a deepening cost-of-living crisis.
Soaring inflation in Britain, driven by the rising costs of
everything from food to fuel, has forced consumers struggling to
pay their bills to tighten their belts during the holiday
period.
In November, British shoppers focused on core grocery
essentials and avoided more discretionary Christmas items,
market researcher NielsenIQ said.
"Whilst traffic and footfall remain reasonably strong,
conversion rates, both in-store and online, continue to be
significantly down year-on-year," ProCook said.
The company saw a loss of 2.8 million pounds ($3.47 million)
as customers limited their shopping to essentials. Gross margin
in the first half declined to 61% on increased shipping and
transport costs, as well as impacts from foreign exchange.
"We are taking cost actions to manage the current
pressures," Chief Executive Officer Daniel O'Neill said.
The company said it has initiated a plan to reduce operating
costs by 3 million pounds on an annualised basis.
"The market was down by over 6% in the period, so making
much progress was always going to be tough, especially as there
was such a dent to gross margins from shipping," analysts at
Peel Hunt said in a note.
ProCook, which is in the process of exiting the Amazon
marketplace, said revenue in the first eight weeks in the second
half of the year beginning Oct. 17 was 5.7% lesser than a year
ago.
Last week, the company cut its revenue outlook and said it
expects underlying profit before tax to be about breakeven in
the full year.
($1 = 0.8078 pounds)
(Reporting by Radhika Anilkumar in Bengaluru; Editing by Rashmi
Aich and Janane Venkatraman)
((Radhika.Anilkumar@thomsonreuters.com;))