The company posted a 2.3% decrease in total sales to £77.6m for the 12 weeks to 27 December in a trading statement this week.
As a result, CEO Mike Davies warned its forthcoming interims would be below analysts expectations. "Under these circumstances, the board expects profits for the 28 weeks ending 10 January 2009 to be no less than £7m with EBITDA in excess of £14m."
He added the company remained focused on delivering its strategy of long-term profitable growth through product innovation, improving the in-store environment and cost management.
Non-store sales grew 5.9% to £6.2m, however, driven by product launches and improved distribution to multiples, despite losing business from former customer Woolworths.