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House of Fraser today declared the slump on the High Street over, as shoppers loosen purse strings and rediscover their zest for fashion.
The department store chain gave its first update on trading in three years since being taken private by a consoritum of investors who include Don McCarthy, now chairman, and wealthy Scot Tom Hunter.
In the last six months the 63-strong chain turned a profit of £10.7 million, a 16% improvement on last year.
Although sales slumped 6.2% in the first three months of the year as the recession bit, the last three months have been positive, up 0.5%.
Chief executive John King was upbeat. “We thought it would be tougher than it was,” he said.
“Retail in general has been pretty resilient this year and it is getting better each week. Margins are up as well.”
The flagship Oxford Street shop vies with one in Glasgow to be the most lucrative store.
King insists the major investment made at the Westfield shopping centre in White City has also paid dividends, despite some scepticism from retail analysts about whether the complex would work.
“We are really pleased with it and there has been no cannibalisation from Oxford Street,” said King.
House of Fraser was formerly owned by Baugur, the collasped Icelandic retail house.
Its near-30% stake in House of Fraser is now held by Lansbanki, Iceland's national bank.
King was quick to downplay any idea that House of Fraser will be looking to float anytime soon, insisting he was merely updating the market on the next three-year plan to grow the business.
“That's not on the agenda,” he said.
There was further good news from Laura Ashley, the fashion and home furnishing firm.
It saw sales up 6.3% to £128 million in the six months to 1 August, allowing it to record a small profit — £1.1 million.
That figure would have been much higher but for a £5.5 million loss on exchange rates after the company failed to hedge its currency position.
K P Phoo, Laura Ashley's chairman, said: “I am encouraged by the positive start we have seen to the second half and remain cautiously optimistic that this momentum will continue.”
Laura Ashley is confident enough to pay a small interim dividend of 0.25p a share to investors.
