Sales leap at born-again Hamleys

HAMLEYS boss Simon Burke confirmed his place among the small circle of retailers who have breathed new life into a struggling icon of the shopping world as London's top toy shop posted an impressive jump in sales.

Turnover at its Regent Street store was ahead by 6.5% last year after an exceptionally good Christmas period. A strong performance from its Hamleys Direct business and its new Bear Factory chain pushed like-for-like sales for the group up by 9.3%.

With tourist spending still down, British shoppers are fuelling the recovery at Burke's revitalised Hamleys. Pre-school toys, dolls and radio-controlled vehicles were the best-performing departments, with Harry Potter merchandising winning the battle for the Christmas pound.

The most visible change under the Burke regime, apart from the reintroduction of the much loved railway, is Bear Factory, the make-your-own cuddly-toys division. Four trial 'factories' were launched 18 months ago as well as an in-house version in Regent Street. Chairman Burke said it was now 'an established and highly profitable part of the business' having grown to a chain of 22 stores by last Christmas and contributed £2.9m in turnover.

Negotiations to open seven new British stores are well under way while recently signed franchise agreements will take the concept into much of the Middle East, Ireland and Sweden. The franchising programme will be stepped up in the coming year following growing interest from would-be partners.

Overall sales at Hamleys Direct, the catalogue and internet business, were up by 97% with pure internet sales up by 116%. Burke said this division would turn a profit next year.

Burke's turnaround of Hamleys echoes the recent successes of Sir Peter Davis at Sainsbury's, Luc Vandevelde at Marks & Spencer and Philip Green at BHS, who have rejuvenated their long-lived, but tired brands. Group sales for the year to 30 March were marginally higher, at £46m, and pre-tax profits edged ahead by £100,000 to £4.1m, excluding exceptional items.

However, Burke said operating profits from core activities was more than 20% ahead at £5.7m. Exceptional costs of £1.5m related to trading losses and rebranding costs at Toystack. The dividend total is maintained at 7.3p. The shares were 5p up at 165p.