Moss Bros has seen its shares plummet as much as 30% as it warned its full year profits would come in below expectations – the second such warning this year.
At the time of writing the company has seen its shares recover slightly at a 22% decrease.
The suit retailer said it had difficulty changing some of its suppliers which had led to a shortage of stock across all of its products in-store and online, harming sales. It also attributed the performance to a reduction in store footfall due to “a more cautious consumer environment”.
Chief executive Brian Brick said: “The beginning of the year has been hampered by short term stock delivery issues caused by the consolidation of our supplier base. The resulting stock shortage has undoubtedly driven a significant shortfall in sales, which will continue until late Spring.
“Although this has been a painful experience, I am confident that the availability issues are well on track to being resolved and the margin benefits from the consolidation will flow through.”
He added: “This stock shortage, has led to a disappointing start to the year and whilst we are still at a very early stage of our new financial year, the more cautious consumer environment and the effect of short term weather impacts, has led to a readjustment of our profit expectations, to protect the Group’s longer term investments.
“In common with many UK retailers, the year ahead looks like being a very challenging one and we have taken action early to be sure we protect the underlying strength of the business. We do believe continued investment is essential to ensure we retain a sustainable point of differentiation and that we leverage our distinct position on the high street.”
Moss Bros also announced that shareholders will also see their dividend reduced to 4p per share for the year 2017/18, down from 5.89p the previous year.