Johnson Services Group warned yesterday that it expected full-year profits would fail to meet City expectations after being dragged down by the performance of its drycleaning arm Johnson Cleaners.
Johnsons, which has about 460 dry cleaning sites after closing more than 50 outlets in recent years, has seen the tough conditions on the high street limit the impact of initiatives such as laundry, repairs, tailoring and Ugg boot cleaning at some of its stores. It is likely that the squeeze on consumer spending has caused people to cut back on the amount spent maintaining clothes.
Johnson has also been closing unprofitable high street stores and opening new sites such as its first drive through cleaners at a former petrol station in Burton-on-Trent, Staffordshire.
It has also opened a branch outside a Sainsbury’s supermarket in Basildon as it looks to follow the crowds away from the high street.
Other initiatives by the Cheshire-based group include eco-friendly Greenearth cleaning products.
The group said results would be marginally below expectations despite a stronger performance from its facilities management division, which maintains shops.
The group also announced that it has renegotiated a new £78.5m million banking facility.
Robert Morton, an analyst at Investec Securities, reduced his profits forecast by £500,000 to £15m for 2011, which would be slightly above the £14.5m the previous year.
He said: “Although results will be slightly below our (previous) expectations, we believe this is a good out-turn considering the difficult trading environment.”
He added that the business had good growth potential over the medium term.