Laura Ashley pre-tax profit slipped 10.8% to £7.8m including exceptional items due to a “challenging” first half caused by the weather.

The fashion and home retailer revealed in the 26 weeks to July 27 that total group sales fell 5.6% to £137.3m and total UK retail sales declined by 5.9% to £120m.

Meanwhile, gross margins improved 1.3% and it ended the period with a £12.7m net cash balance.

Like-for-likes dropped 2.2% in the period.

Laura Ashley chairman Tan Sri Dr KP Khoo said: “The first half of 2013 has proved to be a challenging one for us.”

He added that the cold weather at the beginning of the year impacted fashion sales and customers did not buy into spring/summer ranges later in the season. In addition, the hot summer negatively affected its home furnishings sales.

But this trend has continued into the second half of the trading year as Laura Ashley recorded a 1.3% like-for-like fall in the eight weeks to September 21, as a result of the underperformance of the fashion category.

Despite this Khoo remained confident in trading for the remainder of the year, saying Laura Ashley’s trading is weighted to the second half of the year.

“As we enter the second half of 2013, we remain confident in both the quality of our product ranges and the underlying strength of our brand, which celebrates its 60th anniversary this year,” he said.

In the half-year period, sales across Laura Ashley’s online business fell 3.7% to £19.7m, as it said improvements across customer ordering impacted operations. But the retailer said it “remains committed” to a multichannel strategy.

In the UK, the retailer closed five stores and opened two new ones. But it has pushed overseas openings, launching more stores in Japan, Australia, South Korea, Taiwan, Hong Kong, Spain and Bulgaria. New store openings are planned for the Baltics, Poland and Armenia.

Khoo said: “We will continue to adjust our store portfolio to ensure it delivers a profitable core business and outside the UK, international expansion remains a key focus.”