Wed, 10th December 2008

Ideal Shopping cuts jobs as FY loss looms

Company now expects a trading loss for the 52 weeks to 28 December 2008 of around £4 million before taking charges for one offs and exceptional costs.

Revenues in November were substantially below expectations and whilst the first nine days of December were broadly in-line with last year, November's shortfall is unlikely to be made up. Accordingly, total net revenue for the six weeks from 26 October 2008 to 7 December 2008 was 17% lower than in the comparable period last year and as a result cumulative net revenues for the 49 week period to 7 December 2008 are well below management expectations.

The company said that headcount is being reduced by 15 per cent which will result in the loss of approximately 70 full-time positions with an additional programme to phase out the majority of temporary staff by the end of the financial year. Redundancy costs of approximately £400,000 will be incurred in the current financial year with an annual saving in employment costs of £1.5 million. Commenting on trading and the appointment of Ian Jebson, Mike Hancox said: 'We are taking radical action to improve sales, efficiency and reduce costs. We remain focused on generating improved returns from our home shopping and internet channels to achieve the best possible results in the current economic climate.