Quiz shares halve on fresh profit alert

Shares in women’s fashion retailer Quiz have halved after the company issued another profit warning following a “significant shortfall” in sales.

Sales at the company’s 240 UK stores and concessions fell 11.1% in the first two months of the year.,

Quiz chief executive Tarak Ramzan said “all aspects of the business” were being reviewed.

Full-year profits are set to be £4.5m, verses £8.2m expected previously.

It made that previous estimate in January, when it downgraded its forecast of £11.5m made in October.

It shares – which were listed in July 2018 – fell 50% to 15p after the latest profits warning. They have fallen sharply since October’s update, when they were trading at close to 150p.

Mr Ramzan said: “Whilst the board remains confident in the strength and appeal of the Quiz brand, as demonstrated by our continued sales growth online, this has been a highly disappointing trading period for the group”.

The warning comes at a time when a number of retailers are facing falling sales on the High Street.

Quiz said that while online revenue had increased by 16.2% in the trading period after Christmas, this failed to make up for the fall in High Street sales. This meant revenue for the trading period was down 1.7% on the same time last year.

Based in Glasgow, Quiz was founded in 1993. It currently has 71 stores in the UK and 169 concessions, most of which are in the struggling House of Fraser and Debenhams department store chains.

It also has outlets in the Republic of Ireland, Saudi Arabia, Malaysia, Singapore, United Arab Emirates, Cyprus, Egypt, Georgia and Pakistan. It says it “focuses on delivering catwalk style looks and all the latest trends at value for money prices” for 16 to 35-year-olds.

Sofie Willmott, senior retail analyst at GlobalData Retail, said sales would have been hit as consumers would have been buying “going out” items – the focus for Quiz – during the quieter months of January and February.

“This coupled with shoppers generally holding back spend in uncertain economic times, has led to a steep sales decline,” she said.

Quiz said its profits had not only been hit by falling sales, but also by the need sell-off clothing at cheaper prices.

It had based its previous forecasts for profits on a 9.2% rise in sales in the last quarter of the year. But it now said the fall in sales and the “increased level of discounting” had forced it reduce its expectations for profits.