Profit warning from Haynes

Profit warning from Haynes

Haynes Publishing Group has issued a profit warning, citing "soft" trade and tighter inventory controls from retailers.

The car manuals publisher said its half year results, which will be posted at the end of January, will be "seriously impacted" by "key consumer retailers implementing working capital management programmes leading to tighter inventory controls" and it is likely to report only a small profit for the half-yearly period.

The Bookseller understands the retailers in question are after-market automotive companies.

A statement issued by the company said: "While there are indications that the worst of the inventory reduction programmes may be behind us, trading remains soft and it is clear that our half year results will be seriously impacted to the extent that the group will only be reporting a small profit for the six month period."

In October the group's interim management statement said revenue was down 19% in the UK and Europe for the first 13 weeks to 31st August, while group revenue was down 18%.

Haynes added: "While performance in the first half has been extremely disappointing, it remains the case that the group's trading normally improves significantly in the second half. The Board will be reporting the group's half year results on 29th January 2015 and at that time, with a further two months of trading behind it, will be in a better position to report on the extent of the second half improvement and the expected outcome for the full year."

In September, the group reported its annual results for the year to the end of May 2014, showing that revenue was £29.3m, 6% up on 2013's £27.6m, while pre-tax profit was £4.2m, up 31% from the previous year's £3.2m figure, in a year where the group had restructured and refocused.

Its interim statement in October added: "Group management are encouraged that where information is available, 'out-of-store' retail sales are tracking ahead of replenishment orders and therefore believe this to be a realignment of current inventory levels rather than a trend which could have a material longer-term impact on the business."