Moss Bros shares lost over a third of its value on Wednesday after the company issued a profit warning.
The mens suit retailer warned expected to deliver profits “materially lower” than market expectations, cutting its dividend to 1.97p per share, resulting in the total dividend for the year of 4p instead of the 5.89p a year previously.
Moss Bros attributed the downturn in profits to “material short-term issues” such as lack of stock availability amid supplier consolidation, in response to sterling devaluation.
Alongside stock issues, the market demand for suit hire had also “proved challenging”.
“The beginning of the year has been hampered by short-term stock delivery issues caused by the consolidation of our supplier base,’ chief executive Brian Brick commented.
“The resulting stock shortage has undoubtedly driven a significant shortfall in sales, which will continue until late Spring. In common with many UK retailers, the year ahead looks like being a very challenging one and we have taken action early to be sure we protect the underlying strength of the business.”
Moss Bros difficulties come amid a string of closures and profit warnings from other major high street retailers in the U.K.
Last month, both electronics retailer Maplins and Toys R Us announced they had fallen into administration after failing to locate a buyer.
Retailers have been struggling to mitigate losses in their brick and mortar stores as consumers increasingly move towards online shopping.
In addition, high inflation levels in the UK continue to outpace wage growth putting pressure on households, encouraging saving as opposed to spending.
Shares in Moss Bros are currently trading -21.28 percent as of 12.41PM (GMT).
