Moss Bros reports 'some recovery' in second half gross margins

Formal wear specialist Moss Bros Group continued to trade well in its latest reporting period and saw margins recover a bit, according to the interim management statement released on Friday morning by the company.

The group reported that it had "continued to trade well" throughout the 19-week period from July 29th to December 8th and is on course to deliver the anticipated levels of growth, in line with market expectations.

Like-for-like sales for the first 19 weeks of the second half were up by 3.7% on last year. Hire sales were described as having performed "particularly well" and the income deferred in the first half of the year due to the summer's sporting events had been fully recovered, according to the statement.

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Some recovery

Gross margins experienced some recovery in the second half, due to less cost pressures on raw materials and more direct sourcing, the statement reported.

The group added that it expects to end the 2012/13 year with net cash of £24m compared to £23.3m at end of 2011/12.

Commenting on the outlook, Brian Brick, Chief Executive Officer, said: "We are encouraged by the trading momentum throughout the business which has continued into this year. We are particularly pleased with the progress and resilience of our Hire business, which has successfully overcome the challenges posed by the summer's sporting activities.

"We enter the important Christmas trading period in good shape. We continue to develop the business by leveraging the strength of our brands and our operational capabilities, whilst managing it to reflect the difficult trading environment. The board remains confident in the outlook for the full year."

The group's share price was up 2.16% to 59.25p at 10:27.

MF