Multichannel retailer Flying Brands Limited has suffered a difficult first quarter with its bird food and flowers businesses continuing to underperform.
The group blamed an increasingly challenging consumer environment and increased competition in key markets for the poor result, with like-for-like orders dropping 19.8% below last year, excluding those businesses acquired in 2010.

Overall group orders for the period to April 1, 2011 are marginally ahead of the same period last year, at £10.8m.

The company is set to begin discussions with its lenders very soon to renegotiate the terms of its banking arrangements. While it says it believes its strategy for transforming the business remains the right one, profits for this year are set to be "materially below market expectations".

The company's flowers and gifts division, currently its main direct-to-consumer business, saw orders of £3.4m for the first quarter, a like-for-like decline of 14.7% on last year.

The gardening division saw a "mixed start to the year", with the bird food business suffering from a marked increase in competition from supermarkets and garden centres, as well as an increasing number of online retailers. Orders to April 1 are 33.5% down on last year at £0.8m.

Profits in this division for the year-to-date are materially below expectations, said the company, and "we do not expect trading conditions to improve markedly in the short-term".

Gardening Direct orders were £5.5m for Q1.

The company recently improved its site at www.gardencentreonline.co.uk and is planning a major re-launch of this brand. Sales are regularly ahead of last year and trading in line with expectations in a challenging consumer environment. The company says it expects the site to be an increasingly important part of its business in future.