IAIN McGeoch, low-profile owner of the Mackays Stores clothing empire, plans to open 29 more stores in 2006-07 after his firm recorded a seventh consecutive year of earnings growth.

The Paisley-headquartered business is also in the midst of a branding makeover, with all 268 UK shops set to convert to the "M&Co" fascia.

The company believes the Mackays name is old-fashioned and wishes to project a more contemporary image, accompanied by a move upmarket. Some 121 stores are already trading as M&Co and the rest will convert by next March. It may even benefit from a subliminal association with the resurgent "M&S" (Marks & Spencer) brand.

The company currently has 76 stores in Scotland. Two of the new stores will be in Scotland, at Stonehaven and Blairgowrie.

The retailer sells competitively-priced clothing and homeware through its Mackays stores. It moved into trendier womenswear with the M&Co chain, which was launched after it bought Midland-based retailer Laroque three years ago. Mackays' stores are generally located in small communities, villages and market towns - so-called "secondary shopping areas" - which analysts say partly shields the company from fierce competition.

A spokesman said: "All of the stores will be going upmarket and will become more femaleorientated, but the company will continue to sell menswear and childrenswear, along with household goods in the larger outlets."

Mackays Stores has prospered since McGeoch bought out brother Len's 49.75-per cent stake in December 2001 in a deal understood to have been worth GBP42m, backed by a Clydesdale Bank loan.

Iain McGeoch, the company's chairman, also assumed the chief executive role earlier in March 2005 after predecessor Paul Vann unexpectedly quit to "look for new challenges". There were unsubstantiated rumours of a boardroom bust-up related to the pace of expansion.

The company posted underlying operating profits of GBP20.4m in the year to February 24, a 20-per cent increase on the previous 12 months. Turnover net of VAT climbed 10-per cent to GBP159m.

Pre-tax profits climbed from GBP14.3m in 2005 to GBP16.5m - after interest, exceptionals, goodwill and a GBP1.2m charge for shares allocated to an employee incentive plan.

"The results were again achieved by a combination of sales and margin improvement offset in part by necessary increases in overheads and increased costs from new stores, " the company said.

Mackays spent GBP24m on capital investment in 2005-06, opening 11 new stores, yet has managed to cut its long-term debt from GBP40m to GBP12m in just over four years. Net interest payments declined to GBP1.2m from GBP1.4m in 2005.

Last year, Mackays introduced a share incentive plan that has resulted in 1600 staff becoming shareholders. The company expects to make a further allocation of shares this year.

Boardroom pay at Mackays fell from GBP1,048,000 in 2005 to GBP865,000. The highest-paid director, assumed to be Iain McGeoch, received GBP473,310 excluding pension contributions, a fraction more than in 2005. He will also have shared in total dividends of GBP961,430. Mackays did not pay a dividend last year.

The funding shortfall in Mackays' defined benefit pension scheme, meanwhile, fell by nearly GBP800,000 on the previous year to GBP11m at the balance sheet date.

Mackays opened its first store at Clydebank in 1953.