Credit crunch to hit Findel profits

In an update, the retailer said: “In light of the deteriorating economic climate, the company has conducted a further review of the home shopping debt book and now estimates that bad debt provision will be£5 million higher than had been anticipated.”

Findel said that full-year profit for the past financial year to March 31 would “be below previous expectations”, but still “marginally” ahead of last year.

The disclosure brings City forecasts for Findel’s profits down to approximately£59 million.

Kaupthing analyst Matthew McEachran said other home shopping businesses, such as N Brown and Next Directory, may be affected by a similar bad debt trend.

He said: “Given Findel’s assessment of the outlook, we would be surprised if others didn’t follow suit, particularly as IVA [Individual Voluntary Arrangement] activity increases and impacts on those with exposed customer bases.”