DEPARTMENT store group Allders has warned Christmas and winter business would be unpredictable this year.

The group, which has a store in the Westgate, Oxford, said sales in the first two months of the season fell by almost one per cent.

End-of-year results showed declining profits for the 12 months to September 30 but the group said its performance was creditable given the market conditions and in comparison to competitors.

Chief executive Harvey Lipsith said: "I do not think we are going to see many companies of the same size and in the same market outperforming us."

He added that it was "more than usually difficult to predict the outcome of the crucial period ahead which embraces Christmas and the winter sales."

Allders has been investing between £17m and £18m a year in a programme of store openings and refurbishments.

In the last year the group, based in Croydon, Surrey, has opened seven smaller format Allders at Home stores and two full-size stores in Bolton and Bromley.

Two further stores are planned for 1999 in Chichester, West Sussex and Broughton, Lancashire. Mr Lipsith said the group had no plans to slow down its investment as this would be the key to success once the economy turned around.

But he said the group would be looking closely at the likely returns from such spending in the light of the retail slowdown.

"We are taking a cold look at some of this investment, but we are certainly not looking to restrict investment," he said.

Allders reported pre-tax profits for the year to September 30 of £19.4m down from £23.1m last year. The figure was in line with a profit warning issued by the company in August. Sales were up at £520.1m from £490.9m last year.

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