C-store retailer McColl’s is set to keep the business rates rebate it was given by the government in March as its chief executive says Covid-related costs have since outstripped the money saved.
Chief executive Jonathan Miller said the c-store group would not be following the lead of other essential retailers and handing back potentially millions of pounds in business rates relief.
Explaining his decision, Miller said that costs relating to the coronavirus pandemic had since outstripped the savings from the government decision in March.
“We were very grateful to the government for the support, which was crucial to help us through this period,” he said.
“I’d say for us the financial impact of the pandemic and keeping our staff and customers safe, and the impact on mix, has exceeded the amount that we’ve received through rates relief. So we believe that we’ve used that relief in the spirit in which it was intended.”
McColl’s joins a handful of essential retailers that have so far refused to return business rates relief, including Waitrose and Poundland. C-store competitor Co-op said it would make a decision on whether or not to repay the rebate in March at the end of its financial year.
Iceland has yet to make an announcement either way on repaying the relief.
For the 53 weeks to November 29, 2020, McColl’s reported a 2.3% rise in sales to £1.25bn, but saw EBITDA slump to between £29m and £30m.
Miller also weighed in on Brexit, which is now 21 days away. While he wouldn’t be drawn on whether no deal would increase prices for McColl’s customers, he did say the ongoing uncertainty surrounding negotiations and the limited time left for retailers to prepare was unhelpful.
“I think it’d be better for everyone if there was a deal. The uncertainty is not helpful, particularly in what is an already challenging environment,” he said. “But, ultimately, we will have to play the cards that we are dealt.”
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