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Underground works hit Foyles profits
01.01.70 | Joshua Farrington
Foyles' annual profit has dived by 25%, hit by the continuing disruption from the Transport For London Tottenham Court Road underground station development in London.
The bookshop chain's sales increased by 2.8% to £23.5 million, up from £22.8m last year, but annual profits to 30th June 2012 fell by 25.5% to £152,552 (£204,681 in 2011). It is the fourth consecutive year the business had recorded a profit.
The retailer's chief executive, Sam Husain, said the sales improvement was down to the company’s new Westfield Stratford City store, which was out-performing turnover expectations. However, he estimated that the Charing Cross Road flagship shop had lost £1.5m of sales over the year, costing the company an extra £0.5m in profit because the TFL developments deterred customers from using the part of Charing Cross Road where the Foyles store is based.
Husain said: "Sales are up because of Westfield Stratford City and because sales are up, so are operating costs in relation to that. But our biggest store is Charing Cross Road, and the disruption has cost us a lot of sales."
Husain revealed he had contacted London Mayor Boris Johnson about the problem but had not received any support and believes TFL is not doing enough to counteract the damage being caused. "They have put a couple of posters up pointing out where our and other shops are but it is not sufficient," Husain said.
It was also "too early" to say how Christmas sales were going and the company, but the company was expecting a big finale weekend before 25th December, Husain said.
He added: "Our focus is now turning to the development of our new flagship store at 107-109 Charing Cross Road, the former St Martin's College building, less than a hundred metres down from the existing store on Charing Cross Road."
The company has teamed up with The Bookseller to invite colleagues from the publishing and bookselling world to work together in creating a vision for a bookshop for the future when Foyles moves its flagship store to the new 40,000 sq foot premises.