BHS recorded profits of £30.2m in the year to March 29, 39.6% down on last year’s figure of £49.4m. Margins are clearly being squeezed hard, because sales were actually pretty flat at £860.3m, down just 2.9% on a like-for-like basis. So given the sales figures being recorded by some of its high street rivals recently – notably M&S, of course – you can see why boss Sir Philip Green described the results as ‘a solid performance in an exceptionally challenging market’.
And there were some impressive figures in today’s results. BHS’s home range actually managed a 6% rise in sales, at a time when almost everyone else in the market has struggled, while childrenswear was also a big winner, enjoying a 5% jump. Green also said that the chain’s solid cash generation had allowed it to invest another £50m in sprucing up its stores – 33 have now been refurbished, and best of all, sales at these new-format stores are almost 10% up on the old-style ones.
Of course Green isn’t denying that times are tough for retailers at the moment; he described recent trading as ‘competitive and unpredictable’, and admitted that sales were down 4% year-on-year for the last six weeks. But that’s not just a knock-on effect from the turbulence in the financial markets, he says. It’s also due to that other kind of turbulence that UK shopkeepers have been bemoaning for time immemorial: the great British weather.
In fact, the ever-bullish retail tycoon told the BBC this morning that the high street’s demise has been greatly exaggerated: ‘Yes, there is going to be some shake-outs, but the retail business is the second-largest employer in the country. I think we need to get a little bit positive,’ Green growled grumpily at his hapless interviewer on Radio 4. ‘Yes, the marketplace is tough. Yes, it is very, very competitive. Yes, there are concerns. But underlying business is not going to disappear. It's not a disaster.’ He suggested a steady hand on the tiller is all that’s required: ‘I think we need to calm the consumers down and give them a bit of confidence’.
Admittedly, since Green also owns the Arcadia Group (which includes Top Shop, Burton and Dorothy Perkins) as well as BHS, he’s got a vested interest in talking up his book. But equally there are few people in the UK that know the high street better than he does – so if he says things are not as bad as they’re made out to be, we’re inclined to take his word for it. Not least because he might shout at us otherwise.