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McColl's sees drop in full year profit

Convenience store operator McColl’s has reported a fall in full year profit after incurring costs relating to its acquisition of 298 stores from The Co-op.

FOOD & DRINK

McColl's sees drop in full year profit

Convenience store operator McColl’s has reported a fall in full year profit after incurring costs relating to its acquisition of 298 stores from The Co-op.

In the 52 weeks to 27 November, pre-tax profit was £17.7 million compared to £21.1 million in the previous year after the company incurred £3.1 million in exceptional costs.

Total revenue rose by 1.9% to £950.4 million to mark sixth consecutive year of sales growth.

However, like-for-like sales were down 1.9% after sales at premium convenience and food and wine stores dropped by 1% and like-for-like sales in newsagents and standard convenience stores fell by 3.3%.

Jonathan Miller, McColl’s chief executive, said: "2016 has been a pivotal year for McColl's during which we were firmly established as a leading convenience retailer, delivered good financial performance in line with expectations and laid the foundations to deliver significant growth in the years ahead.

“With new appointments to our management team and a refreshed strategy in place, we are ready to begin the next stage of our journey to become your neighbourhood's favourite shop.

"We are pleased to have recorded our sixth successive year of revenue growth and to have met our target of operating 1,000 convenience stores, which truly marks the completion of our journey to become first and foremost a convenience business.”

The company has also given an update on current trading and said that total like-for-like sales were down by 1.3% in the 13 weeks ended 26 February. Total revenue for the quarter was up 2.1%.

McColl’s said the integration of the 298 Co-op stores is progressing well with the first store opening in Canvey Island on 31 January, and over 20 stores now trading as McColl's.

Looking ahead, the company said: “The outcome of the EU referendum last June has created some uncertainty for the sector and the economy as a whole, however we are committed to working proactively with our suppliers to ensure that we remain competitive for our 4.5 million customers. Although we have not so far seen any discernible impact on customer behaviour following the referendum, wider industry data shows that concerns around price have resurfaced and customers continue to shop around, shopping little and often to manage their budgets.”

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