Bhs full-year profit down 40 pct and no dividend

By James Davey

LONDON (Reuters) - Bhs Group, the department store chain owned by billionaire Philip Green, posted a 40 percent fall in full-year operating profit on Tuesday, and for the fourth year running Green decided not to take a dividend.

Green told Reuters the trading outlook was "very, very difficult" to read after Bhs reported an operating profit of 30.2 million pounds for the year to March 31, compared with 50 million the previous year and the record 112 million in 2004.

Total sales fell 1.4 percent to 860.3 million pounds and were down 2.9 percent on a like-for-like basis, which strips out the contribution from new space opened in the year.

Cash generation fell 33 percent to 72 million pounds, and year-end debt was 63 million pounds, in line with last year.

Monaco-based Green said the outcome was "a solid performance in an exceptionally challenging market."

He said Bhs suffered from sharply higher underlying costs. "Rent, rates, light, heat, transport, minimum wage; these don't go away," he said.

The decision to pay no dividend was down to Bhs's continuing refurbishment programme. Capital expenditure more than doubled to 53 million pounds.

The market remained competitive and unpredictable, said Green.  Continued...