LONDON (ShareCast) - Sales at clothing and furniture retailer Laura Ashley fell as customers tightened their purse strings.

The group warned that, "Uncertainty arising from the current economic climate and its effect on retail from weaker consumer spends coupled with the opening of our new stores impacting existing stores, have affected our LFL sales".

Sales fell 7.6% in the 17 weeks ending January 2009 at stores open for at east a year. Total sales rose 7.9%, helped by new store openings.

"Despite the difficult trading outlook anticipated for the period ahead, we expect our profit before tax for the financial year ending 31 January 2009 to be broadly in line with brokers' forecasts," the firm said.

The group, famous for its floral designs, opened 12 new stores in the 17 weeks and closed 2 stores in the UK. Last year it opened 19 new stores.

Laura Ashley's franchising and licensing sales saw marginal declines compared to last year while its Mail Order and Internet sales rose 8.1%, driven mostly by its Internet business.

Its balance sheet stands at £12.3m net cash, with no borrowings, the group said.

"We will continue to focus on our store expansion and realignment programme, improved product offering and improving our operational efficiencies," the retailer added.

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