Postie Plus says higher than expected sales growth in the first half of this year will result in a much smaller loss for the period than it had forecast.
The listed retail group, which also the Baby City chain, says first half sales grew more than 9%, compared with the same period last year.
Sales in the second quarter, which covers the three months to the end of January, rose 5.5%.
Chief executive Ron Boskell says the results are confirmation that recent changes in styles are working alongside marketing campaigns. The results have been seen in all regions.
