Look that's back in fashion

FASHION group New Look continues its rehabilitation after last year's troubles with news of a near-15% increase in profits over the first half and accelerating sales growth.

Sales for the six months to 22 September increased by 22.7% overall, to £276.3m, with a like-for-like increase in its UK operations of 2.7%. That has accelerated to 7.4% in the first eight weeks of the second half, helped by improvements to the product ranges.

Margins strengthened by 2.1% and taxable profits rose from £23.8m to £27.3m. The dividend is raised by 4.7% to 2.2p and the shares jumped 9p to a 16-month high of 129p.

Chief executive Stephen Sunnucks said the group's strategy was beginning to deliver. It has cut out duplication in its product ranges and margins have strengthened on the back mix of more full-price sales.

Other improvements to its ranges include a stronger offering in tailored products and the introduction of coats this year for the first time.

The group, which has a chain of 485 shops, said that while it has seen 'no substantive evidence' of a downturn since 11 September, it remains cautious about the economic outlook and the potential effect on consumer spending. At the moment, however, 'people do seem to be out there shopping', said Sunnucks.

New Look's operations in France, now merged with the Mim business, made profits of £1.7m against a loss last time of £400,000.