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Spending on shop fit-outs hits profit at Kast

KAST Retail has seen its profits more than halve as it invested in shop fit-outs and improving its infrastructure.

IN FASHION: Tarak Ramzan started the Quiz Clothing chain in 1995. It now has 20 shops in Scotland and 37 south of the Border. Picture: Michael Boyd
IN FASHION: Tarak Ramzan started the Quiz Clothing chain in 1995. It now has 20 shops in Scotland and 37 south of the Border. Picture: Michael Boyd

The Glasgow-based women's fashion retailer, which trades on the high street as the Quiz ­Clothing chain, recorded a near 5% increase in turnover from £36.9 million to £38.6m in the 12 months to March 31, 2013.

Sales to retail customers dipped from £30.7m to £28m but sales to other related companies went from almost £6.2m to more than £10.6m.

Administrative expenses increased £17.66m to £18.56m while the cost of sales surged 11% from £18.16m to £20.22m.

Accounts filed at Companies House show pre-tax profits dipped from almost £1.1m to £447,297.

Writing in the accounts, the directors - Omar Aziz, majority owner Tarak Ramzan and his son Sheraz - said: "Although the economic environment in the UK has been challenging, KAST Retail Limited has continued to expand successfully. In the coming year, the directors feel they are well-placed to take advantage of further opportunities.

"Profits decreased but this was mainly due to expenditure on developing the infrastructure required to position the company for future growth and also on new shop fittings.

"The directors are confident that profit will increase in the coming years."

They added that the business was committed to delivering "catwalk-style looks and all the latest trends at value-for-money prices".

In October last year, Quiz said it had invested £500,000 in expanding its Glasgow headquarters, where it employs about 90 people.

The accounts state that average staff numbers in the period grew from 614 to 629, with employee costs rising from £6.3m to almost £6.5m.

Directors' remuneration plunged from £281,494 to £126,305 and there were no dividends paid.

The accounts showed capital expenditure was steady at £1.6m while net debt more than ­quadrupled from £441,844 to in excess of £1.7m.

Tarak Ramzan built up the family company, founded in 1965 and called Tarak Manufacturing, in the 1980s after he left university in his first year to help out in the running of the factory.

From being a small supplier, it eventually made clothes for many high street retailers, including the likes of Burton.

When cheaper manufacturing options in the Far East began to eat into that business, Mr Ramzan then started the Quiz fashion chain in 1995 and expanded it quickly by opening further outlets in the UK and abroad.

But in 2009 the Tarak Clothing Company, which traded as Quiz, called in administrators as a result of the tough trading conditions in the sector. However, Mr Ramzan and his family immediately bought back 44 of the 48 stores in a pre-pack deal which preserved around 400 jobs.

According to its website, Quiz now has 35 shops in England, 20 in Scotland, six stores in Northern Ireland and two in Wales, as well as an online store.

It says it has more than 70 ­international outlets and concessions across Europe, Asia and Africa, with plans to keep growing into new areas.

Mr Ramzan and the other directors were not available for comment yesterday.

The other related companies listed in the accounts were Tarak Manufacturing, Tarak Retail, Shoar Holdings and Tarak International.

The most recent accounts for Tarak Manufacturing show a retained profit of £82,000 in the 12  months to March 31, 2013.

Tarak International recorded a retained profit of almost £826,000 in the same period.

Tarak Retail, which is owned by Shoar Holdings, posted an £878,575 pre-tax profit on turnover of £10.05m.

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