March 7 (Reuters) - Shares in QUIZ Plc dropped more than 50 percent on Thursday, hitting an all-time low after the fast-fashion retailer cut its fiscal year 2019 revenue and core earnings outlook, as consumers clamped down on spending.
Glasgow-based QUIZ said it had lower sales in the first two months of 2019 and it was forced to offer heavy discounts to battle anaemic consumer spending.
“The board will be reviewing all aspects of the business over the coming months to ensure that we can deliver the group’s long-term potential despite the changing consumer backdrop and challenging trading conditions,” Chief Executive Officer Tarak Ramzan said in a statement.
Paul Hickman, analyst at Edison Investment, said the review would eventually result in QUIZ exiting from some of its stores and concessions.
QUIZ shares, which fell nearly 79 percent last year, were 52.5 percent lower at 15.3 pence at 0850 GMT. The company was valued at 17.4 million pounds at its stock low on Thursday, down from a valuation high of 250 million pounds last year.
QUIZ flagged a significant shortfall in sales between Jan. 1 and Feb. 28, compared to its prior expectations. Revenue from QUIZ’s UK standalone stores and concessions fell 11.1 percent in the period, while group revenue fell 1.7 percent.
QUIZ said it expects revenue for the year ended March 2019 to be about 129 million pounds ($169.80 million), lower than its previous expectation of 133 million pounds.
The company’s core earnings expectation fell to 4.5 million pounds from 8.2 million pounds after what it called a “highly disappointing trading period”.
Founded in 1993, QUIZ employs more than 1,500 people and operates 71 stores and 169 concessions in the UK. Fast-fashion companies produce inexpensive clothing rapidly in response to the latest trends.
Retailers have been battered by rising costs and uncertainty around Britain’s impending exit from the European Union. The trading environment was brutal in the run-up to Christmas with many retailers forced to cut prices.
Debenhams Plc warned on profit again on Tuesday, reflecting a major shift towards online shopping, subdued consumer spending and upheaval at department stores.
QUIZ, which faces competition from online players like Amazon.com and bigger rivals H&M and Zara , had already warned on full-year revenue in January, with overall sales during the Christmas period below its expectations.
($1 = 0.7597 pounds)
Reporting by Noor Zainab Hussain in Bengaluru; Editing by Bernard Orr