Lewis Group has said it expects a significant drop in full-year headline earnings, but the news came as no surprise for investors, who pushed the share price up as much as 3% in intraday trade on Thursday. Avior Capital Markets consumer goods analyst Mark Hodgson said the update, released late on Wednesday, had been in line with expectations. Hodgson said the statement showed like-for-like metrics that were still concerning while gross profit margin and net debt improvements were pleasing. Merchandise sales for the year to March showed a 2.2% decline with like-for-like sales down 9.3%. The furniture retailer said that overall revenue decreased 3.3%. The group’s gross profit margin improved to 41.6% from 38% in the previous year. "The trading environment continues to be tough for Lewis in the short run and management’s outlook is likely to be cautious," said Hodgson. Lewis said the drop in earnings was partly due to its 2016 results benefiting from a one-off windfall of R496m from se...
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