Sir Philip Green's Topshop and BHS empire saw annual sales slip and warned recent trading had worsened amid the mild autumn weather.
Arcadia, which also owns high street brands including Burton, Dorothy Perkins and Miss Selfridge, followed New Look in revealing the impact of warmer-than-normal conditions after the fashion chain said this week that shoppers had been holding back from buying winter clothes.
Figures from the Office for National Statistics today also showed the impact of an unseasonably mild autumn on demand for clothing as retail sales fell unexpectedly in October, down 0.7%.
Arcadia disclosed a 3.7% drop in comparable store sales in the first 10 weeks of its new financial year, after falling 2.7% in the 12 months to August 31.
Sir Philip said "trading conditions remain challenging", with the results marking the second year of declining sales .
Underlying pre-tax profits edged 0.5% higher to £167.8 million, but adjusted earnings fell 2% to £220.9 million.
Sir Philip did not pay a dividend for the eighth year running, with the last payout in 2005, when he banked a £1.2 billion windfall.
The full-year figures come amid speculation over takeover interest in Sir Philip's struggling department store chain BHS.
Overseas suitors are reportedly circling BHS, with potential bidders said to include Christo Wiese, who is South Africa's third richest man with a fortune estimated at £2 billion, US private equity firm Apollo and a number of retail turnaround firms.
But Sir Philip is not understood to be holding any talks currently over a sale of BHS, which he bought for £200 million in 1999.
BHS has been weighed down by expensive leases and a pension fund deficit, although it is still a force on the high street with 180 stores and annual sales of £700 million.
Arcadia said it was continuing to drive overseas expansion, with a further 161 new stores planned over the year ahead after 127 franchise shops opened in 2012-13.
Its Topshop/Topman brand has been increasing its presence in the United States, following Sir Philip's move last year to sell a 25% stake in the chains to American private equity firm Leonard Green & Partners for £350 million, valuing the businesses at £2 billion.
Sir Philip said he had been "collaborating closely" with the investor and now has four fully-owned Topshop/Topman stores in the US, with more in the pipeline.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article