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Pentland sales defy downturn

Pentland Group, the parent company of mega brands Lacoste, Speedo and Kickers and majority shareholder in retailer JD Sports Fashions, is ready to swoop on more brands after it defied the sector gloom to post a 6% rise in sales and profits at its branded division.

Pentland Group saw its sales, which include JD Sports Fashion's sales for the year, rise by 7.3% to £940.9 million while group profits were up 56.5% to £68.4m. Sales for the branded operation rose 6% to £391.7m and profits rose 6% to £21.2m.

Andy Rubin, a director of Pentland Group and chief executive of its branded business Pentland Brands, which also includes the Boxfresh and Radcliffe Denim brands, said: "We’re finding that a number of brands are coming to talk to us because of the market. They are struggling to get bank financing and as we have no debt we are not in that position."

Rubin said he had received approaches from a mixture of strong brands which were looking for cash to expand, as well as from brands struggling to survive in the current economic climate. The accounts show that Pentland is hugely cash rich with £173m in the bank.

Rubin added: "The banks are not lending, even to good businesses. There are always things that are interesting to us but we have got a lot on ourselves already. We will pick one or two investments to do this year though."

Separately, Pentland has closed its own-label footwear supply operation. The business supplied several high street footwear chains in the UK and US but it is understood to have contributed less than £10m to group turnover.

Rubin said that increased costs attached to sourcing from the Far East and the uncertainty surrounding import duties from China, coupled with the own label business's small scale and continuing price deflation in the market, had made the operation unviable because retailers and consumers were not prepared to share any of the burden of price hikes. Rubin said he would redeploy as many own-label employees as possible across the rest of the group.

He added: "We don’t have any need as a business for the operation. We have a strong portfolio of brands."

Rubin said a strong performance at Lacoste footwear, Speedo, Berghaus and its licensed Ted Baker footwear business had helped the group report strong results last year. He said he had also seen good improvements at footwear brand Kickers and an excellent year for the footwear brand Red or Dead, which it licenses out to footwear and fashion retailers.

In addition, Hunter Boot, the premium wellington boot brand, which Pentland Group helped rescue from administration in 2006, has moved back into the black with a net profit of £1.6m on sales of £9.9m.

Rubin said he was confident about performance this year and was excited about the development of Speedo's LZR Racer performance swimwear, which will be worn by swimmers at the Beijing Olympics this month. Rubin said Speedo's collaboration with Commes des Garçons would also bring in strong sales.

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