SHARES in Body Shop have tumbled nearly 20 per cent after the retailer warned that lower-than-expected Christmas sales in Britain and the US will hit profits.
Same-store sales in Britain were up one per cent during the trading period, down from a five per cent rise the year before. In the US, meanwhile, sales dropped one per cent on the back of a fall in customer numbers and supply chain problems.
Body Shop is now expected to post full-year profits of about £40m, down from £44.5m. As well as the Christmas sales shortfall, the group faced costs of £4m to pay for its reorganisation drive.
The underperformance in the US and UK, together with the impact of the non-recurring costs, underplays our potential
Peter Saunders, chief executive
See Body Shop's share price
As a result operating profits will now be level with, or marginally ahead of last year, the company said.
However, the cosmetics retailer reported strong progress for its operations in Europe, Middle East, Africa and in Asia Pacific.
Branches in Hong Kong and Singapore did particularly well, Body Shop said.
"The underperformance in the US and UK, together with the impact of the non-recurring costs, underplays our potential," said chief executive Peter Saunders.
Shares in Body Shop were down 52 pence, or 19.66%, at 215.5p on Wednesday morning.
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