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LK Bennett profits fall amid 'challenging' conditions

LK Bennett has blamed challenging trading conditions in the UK for a drop in its group sales and profits last year.

Despite investing heavily in international markets, the premium womenswear retailer saw turnover drop 3% to £91.2m in the year ending 27 July 2013.

Gross profit during the period fell 5.5% to £59.3m and overheads increased, leading to a 67% decline in EBITDA to £3.6m.

“In 2013, like many of our competitors, we saw challenging trading conditions in the UK,” said Robert Bensoussan, who returned to the role of chief executive in February following Didier Drouet’s departure.

“Given the difficult background in the UK, the decision we took in 2009 to invest heavily in overseas markets continues to bear fruit and we were delighted to see our international retail business continue to grow.”

Sales in international markets grew 36.5%, making up 30% of LK Bennett’s group sales. The retailer enjoyed particular success in the US, where it now operates 10 stores in locations including Las Vegas and Beverly Hills.

It continued to rationalise its UK store base in 2013, closing two standalone stores and seven concessions, but opened a new flagship on Marylebone High Street in London.

“We are focusing our [UK] portfolio on our most profitable and brand appropriate locations,” said Bensoussan.

To support continued expansion, LK Bennett has agreed a new £20m facility with asset-based institution Burdale, which replaced Lloyds Banking Group as the chain’s main lender in 2013.

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