Shares digital

Last week Land of Leather (LAN:AIM) forecast that it would be 'marginally profitable' in the second half but this projection is already under threat after its chief concessionaire Sleep Depot, went into administration as we went to press.

This could cost Land of Leather £1.6 million in the second half and £4.8 million in a full year. Although the company claims that it could mitigate this by trading from the vacated space that is a pious hope.

Land of Leather has been suffering an underlying sales downturn of 18% and needs more customers – not additional space, which will in turn involve a further increase in working capital. Although the group will eventually let out the space, the credit crunch is likely to restrict the enthusiasm of other retailers in the immediate future.

Shares says: A further reason not to buy these shares. AVOID

by: John Marshall