UP Global Sourcing hit by retail slowdown

Distributor of brands including Russell Hobbs suffers as customers delay purchases

UP Global Sourcing (UPGS) 95p

Original entry price: Buy at 178p, 4 May 2017

Our faith that consumer products distributor UP Global Sourcing (UPGS) could buck a weak retail trend has proved misplaced.

A little more than six months after joining London’s Main Market the company has been forced to release a damaging profit warning.

Ultimate Products, as it is better known, has warned of no growth in its current financial year running to 31 July 2018.

The retailers which form its customer base are exercising caution on buying stock for the autumn and winter. ‘The fact that this retailer caution is occurring in the seasonally more important first half of the year (in FY17 61.9% of the group’s revenues were generated during this period) represents a significant short-term headwind,’ it comments.

We had hoped the company could compensate for a fall in retail demand by increasing market share. Despite pointing to its experience in managing these dynamics and of delivering growth ‘in the longer term’ this has not proven to be the case in the short-term.

giu4

 

 

‹ Previous2017-09-14Next ›

Important information:

These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell Youinvest.

Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.

Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.

The Shares team
Disclaimer

Advertising feature

Issue contents

The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.