Arcadia pre-tax profits are set to drop by a third following the sales slump caused by last year’s harsh winter.
Profits in the year to August 28 are set to slump by more than £70m to £140m.
The results, to be unveiled on Thursday, will be further evidence of the consumer downturn, which has hit high street retailers this year.
Last week Mothercare revealed it had slumped to an underlying loss of £4.4m in its first half after UK like-for-like sales fell by 7% and fashion chain French Connection’s profits were down £1.8m in its third quarter.
In August, owner Sir Philip Green warned senior staff that profits would fall and that the market would be tough for some time.