A sudden downturn in digital camera market in February hit profits at high street photographic chain Jessops for the year ended 30 September 2005. rnHowever, a u2018partial recoveryu2019u2013 helped by a growth in digital SLR sales - led to profits in line with its revised profit expectations.rn
A sudden downturn in digital camera market in February hit profits at high street photographic chain Jessops for the year ended 30 September 2005.
However, a ?partial recovery?? helped by a growth in digital SLR sales – led to profits in line with its revised profit expectations.
Commenting on the results chairman Gavin Simonds said: ?February saw a sudden downturn in the market, with the strong growth in digital camera sales we had previously enjoyed ceasing.?
Though overall sales at Jessops was up 2.6% in value terms, compared to the previous year, the ?like-for-like? sales figure fell by 0.4%. Like-for-like sales figures exclude the effect of such factors as company expansion or acquisition during the year, to provide a comparable sales figure to the previous 12 months.
Jessops points out that its profit before tax of £5.9m is in line with its revised profit expectation and is the second most profitable year in its history.
However, it revealed that like-for-like sales at ?store? level have fallen by 3.6% for the first eight weeks to 27 November 2005.
Total camera sales for the year to 30 September 2005 rose 6.9% in value with digital cameras accounting for 88.7% of total camera sales.
Jessops chief executive Derek Hine admitted that the growth in digital camera sales ?dried up completely in February? but said that the company is encouraged by strong digital SLR sales during the year.
Digital camera sales were up 13%, with digital SLR sales jumping 124% in value terms driven, claims Jessops, by ?more manufacturers entering the digital SLR market, providing the consumer with a wider range of products at competitive price points?. The company also acknowledges that the march of technology means that the ?replacement cycles of digital cameras are more frequent than those experienced with analogue [film] cameras.?
Hine said there are ?greater uncertainties than ever on the high street? and he remains cautious about trading in the short term.
Jessops said household penetration for digital camera is around 50% – a figure it describes as ?a long way below those achieved by analogue cameras?.
The downturn in the digital camera market in February forced Jessops to revise its previous expected profit figure.
Simonds described Jessops first year as a company listed on the Stock Exchange as ?challenging? and a ?turbulent period for the British high street and our market place?.