Clinton issues profit warning
Clinton Cards has been forced to lower expectations for this year after weaker trading driven by the poor performance of its stores in Ireland.
Three months after telling investors it was on course for better-than-expected annual profits, Clinton has revealed a deterioration in sales since May.
It said total sales were behind expectations and added that adjusted profits from continuing operations in the year to the beginning of August were now likely to be similar to last year.
The company, which has around 860 stores under the Clinton Cards and Birthdays brands, said trading had been impacted by the "disproportionately poor performance" in its 13 stores trading in Ireland.
Despite a subdued start to the second half of its financial year, Clinton upgraded its guidance in March after tight control of its cost base and an "encouraging" first six months of the period.
This led Numis Securities to raise its profits forecast for the full year from £13.7 million to £16 million, rising to £18 million the year after.
The group's loss-making subsidiary Birthdays was put into administration last year but profits have been helped by the group's acquisition of the chain's better performing stores from administrators in June and negotiations with landlords which reduced its rent bill.
Shares in the greetings card retailer fell more than 8% on Wednesday.
Numis said the "stubborn underperformance" of the Irish Birthdays stores would generate losses of £1 million, compounding the impact of low footfall in the UK.
However, it said the company has maintained its cost discipline and stands to benefit from self-help measures and its position as the market leader.