Beales reports 'credible' first-half performance despite loss

The exceptional costs related to its refinancing with Burdale Financial and the move from a premium to a standard listing to the stock exchange while unseasonable weather hit sales.

But a joint statement from outgoing chairman Keith Edelman and chief executive Michael Hitchcock called the performance a “credible result given the economic and retail backdrop”.

In the 26 weeks to May 4 like-for-like sales dropped 7% due to its exit from TV and audio categories but this was offset by more targeted promotions. Gross sales also fell 7% to £65.9m.

Gross profit fell £2.1m to £18.4m against the same period last year.

Beales said administration costs shrank 13.8% due to better cost control and cost restructuring.

Beales said it closed its Maidstone store at the end of June and it is set to shutter its Cinderford store at the end of July. Meanwhile, it is planning to surrender its lease on its Tonbridge store to Sainsbury’s. Through the deal Beales has received £1m and is set to receive another £3m on the lease surrender.

Edelman said: “Weather has dominated and negatively affected the first-half performance; the management team has undertaken a tremendous amount of work to set up the operational structure of the business to succeed.

“There are further initiatives in progress to further enhance the process improvements evident in the cost control and there are a number of key strategic steps being taken to drive sales.”

The closure of the store card account resulted in a cash flow increase to £2.3m against last year’s outflow of £1.2m. Meanwhile, net debt reduced slightly to £13.7m from £13.8m in April last year.