Subdued demand leads to Havelock Europa revenue dip

Furniture and interiors provider Havelock Europa has posted a dip in half year revenues as it contends with subdued demand in the UK retail and financial services sectors.

Group revenue from continuing operations was down to £28.9m from £30.5m, and the outlook for the retail and financial services sectors remains subdued, the company said in its interim results for the six months to 30 June published on Monday.

That led to a slightly wider loss of £2.4m, increased from £2.3m in 2014.

Group net debt also increased from £2.6m to £3.1m due to an £0.8m increase in finance lease obligations from the company’s investment in its enterprise resource planning system.

However, international retail sales are on target to achieve expected growth, helped by a new management team in place in May.

The AIM listed company is also on track with its business reorganisation project to be completed by the end of the year, which is expected to contribute to annualised cost savings of £3m for 2016.

Havelock Europa chief executive officer David Ritchie said, "Whilst the short term trading outlook is challenging I am confident that the business reorganisation plan [announced on 1 September 2015] will enable the business to deliver sustainable profits in the future.”

At 1128 BST, shares in Havelock Europa remained flat at 12p per share.