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Last Updated: Wednesday, 11 January 2006, 12:10 GMT
Body Shop issues profits warning
Body Shop store in London
The Body Shop is another victim of the High Street slowdown
Shares in Body Shop have tumbled nearly 20% after the retailer warned that lower-than-expected Christmas sales in the UK and US will hit profits.

Same-store sales in the UK and Ireland were up 1% during the trading period, down from a 5% rise the year before.

In the US, meanwhile, sales dropped 1% on the back of a fall in customer numbers and supply chain problems.

Body Shop is now expected to post full-year profits of about 40m, down from 44.5m previously.

As well as the shortfall in Christmas sales, the group has faced costs in excess of 4m to pay for its reorganisation drive.

The underperformance in the US and UK, together with the impact of the non-recurring costs, underplays our potential
Peter Saunders, chief executive

As a result operating profits will now be level with, or marginally ahead of last year, the company said.

However, the cosmetics retailer reported strong progress for its operations in Europe, Middle East, Africa and in Asia Pacific.

Branches in Hong Kong and Singapore did particularly well, Body Shop said.

"The underperformance in the US and UK, together with the impact of the non-recurring costs, underplays our potential," said chief executive Peter Saunders.

Shares in Body Shop were down 52 pence, or 19.66%, at 215.5p on Wednesday morning.


SEE ALSO:
Body Shop beats High Street blues
28 Apr 05 |  Business
Christmas sales up at Body Shop
14 Jan 05 |  Business
Upbeat Body Shop aims for growth
29 Apr 04 |  Business
Body Shop fightback continues
15 Oct 03 |  Business
Body Shop begins turnaround
30 Apr 03 |  Business
The end of Anita's heyday
12 Feb 02 |  Business


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