THE owner of the RS McColl newsagent chain has reported a bounce back into profit in the first half of its financial year in spite of difficult trading conditions.
McColl’s Retail Group, which floated on the London Stock Exchange in February last year, saw its total revenue rise more than three per cent to £459.3 million in the six months to May 31.
However like-for-like sales dipped 1.9 per cent in the period however its portfolio of 664 upgraded convenience stores posted flat sales with the remainder down by 4.7 per cent.
Chief executive James Lancaster said that gave him confidence the business was pursuing the right strategy by updating its shops, opening for longer and adding in new grocer and alcohol products.
He said: “That is the only way you are going to get sustainable growth in the retail stores.”
Profit before tax was £7m, an improvement from a loss of £4m in the prior year although the latter number included £6.2m of exceptional charges including £1.7m from its initial public offering.
Across the six months McColl’s acquired 25 new stores and converted 16 newsagents to its food and wine format.
That gave it 837 convenience stores and 496 newsagents at the end of the period. It has around 150 sites in Scotland.
Mr Lancaster cited the addition of alcohol into 55 newsagents in the reporting period as another example of the company trying to offer more to its customers.
He said the initiative has produced an “encouraging sales uplift” and has now been extended into 100 outlets.
The company is also trialling a Subway franchise in one of its petrol forecourt sites and has added coffee and food to go options in 100 locations.
While he declined to break out specific trading performance in Scotland Mr Lancaster acknowledged he was “very happy” with how the business was performing here.
Mr Lancaster believes the company is on course to meet its target of having 1,000 convenience stores by the end of next year.
A further 45 will be upgraded to food and wine stores by the end of the financial year.
It operates 483 Post Offices within its estate and expects to grow that to 500 in the next few months.
McColl’s has also signed up 390,000 members to the Plus loyalty card scheme it launched last year.
Mr Lancaster said the business has added around 500 people over the past 12 months and was supportive of plans introduced by the Chancellor to pay a living wage.
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