Mountain Warehouse says inflation has peaked as profits rise
Chief executive Mark Neale said he was not surprised that inflation held steady last month.
The boss of outdoor clothing retailer Mountain Warehouse said the UK’s surging inflation has peaked as he unveiled a near-20% rise in half-year profits.
Chief executive Mark Neale told the Press Association that he was not surprised that inflation held steady last month and said some of the firm’s price tags were already starting to fall.
He said: “I think (inflation) has peaked … I certainly see no more inflation in the system from our point of view and I cannot see much more currency-related inflation in anybody else’s (businesses) really.”
The Consumer Prices Index (CPI) was widely expected to reach 3.1% in October, up from 3% in September, intensifying the squeeze on consumer spending power ahead of the Christmas season.
Instead, CPI held steady at 3%, leaving economists split on whether inflation has finally topped out or will continue to push higher, with the Bank of England forecasting the cost of living to reach 3.2% during the autumn.
It comes as Mountain Warehouse brushed aside the woes enveloping the British high street, lifting pre-tax profits 18% to £4.7 million and opening 18 new stores in the UK and overseas.
Sales rose 19% to a record £91.6 million for the six months to August 27, with its international business proving a standout performer, with sales surging 50% and counting for around 25% of total revenues.
The retailer, which has more than 270 shops and employs around 2,250 people, said online sales climbed 19% over the period.
Mr Neale also revealed plans to expand Zakti – a sister brand aimed at younger customers – into Mountain Warehouse stores in an attempt to rake in more sales.
He said: “We are investing in new stores, expanding our online offer and exploring new territories.
“We have also taken the decision to extend roll out of our popular Zakti brand to stores across the country. We believe this will help widen our appeal still further and reach new customers.”
Mountain Warehouse created 200 jobs over the period, with plans to add another 100 to the workforce by opening 10 more stores in the second half of the year.
The retailer said it would launch shops in Oxford and the Suffolk coastal town of Southwold, while it weighs an expansion drive into the Netherlands and the Czech Republic.