The gloom on the High Street reached new depths on Saturday after a report by Ernst & Young
revealed that more profit warnings were issued in the first six months of the year than the whole of 2010. The analysis showed that 26 profit warnings were made by listed retailers, twice as many as were made in 2009, before the financial crisis had an impact on the economy. The number of general profit warnings rose by 40pc in the second quarter of 2011.
Ernst & Young says that suppliers, spooked by the spate of retail failures, may also cut back their lines of credit to struggling retailers. The cost of stocking the shelves for Christmas may force the collapse of several more high street retailers, a leading accountancy firm has warned. Ernst & Young said retailers who had been "hanging on in there" since the 2008-09 recession might not be able to build up enough cash to pay for extra stock for the crucial festive season as well as the rent due at the next quarter-day in September.
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