McColl's Retail Group has announced its results today for the 26 week period ended 31 May 2015, with total revenue rising by 3.4% to £459.3m (2014: £444.2m).
Like-for-like (LFL) sales were down by 1.9%, split as below:
o LFL sales in food and wine and premium convenience level with last year.
o LFL sales in newsagents and standard convenience down 4.7%.
Operating profit before exceptional items £9.6m (2014: £10.0m), and adjusted EBITDA up by 1.9% to £16.2m (2014: £15.9m). Profit before tax stood at £7.6m (2014: loss of £4.0m).
Convenience store expansion strategy remains on track and continues to capture market share:
o 25 new stores acquired;
o 16 newsagents converted to food & wine format; and
o Store base at period end comprises 837 convenience stores and 496 newsagents.
Good performance was shown in the 664 food and wine and premium convenience stores with flat LFL sales despite deflationary pressure. Also, there was good progress on food to go and alcohol into newsagents.
CEO James Lancaster said, 'I am pleased to report a solid financial performance in what has been a very challenging period for the sector.
'Over the past 12 months we have continued to make good progress on our strategic objectives and focussed on improving our range and offer, increasing our store base and streamlining the business.'
He continued, 'Whilst overall like for like sales were down 1.9%, sales have held up in those of our stores that have benefitted from conversion to either premium convenience or food and wine formats. This demonstrates the strength of our business development strategy and we will continue to grow market share in our convenience offering.
'We maintained good momentum on store development by adding a further 25 stores in the period and by completing a further 16 food and wine conversions, finishing the period with 837 convenience stores. We are on track to achieve our stated objective of 1000 convenience stores by the end of 2016. We also made good progress on improving products and services, with a number of these initiatives, including food to go, producing encouraging sales results.
'During the period, we have also reviewed opportunities to improve efficiency and reduce costs resulting in restructuring some support services within head office and field operations.'
Lancaster concluded, 'We are confident that our specialist position as a leading neighbourhood retailer, supported by our continued investment in convenience conversions and the acquisition of new stores, will allow us to take advantage of the market in which we operate. We remain on track to achieve results in line with expectations for the financial year and are pleased to announce an interim dividend of 3.4p per share.'