However, pre-tax profits slid 15.8 per cent to£6.1 million. Figures were hit by the closure of its loss-making Jewellery Vault channel last June. Reported operating profits tumbled 18.3 per cent to£5.6 million, but underlying operating profits rose 2 per cent to£7.7 million. The group's annual turnover increased 8.1 per cent to£85.6 million, compared with£79.2 million in 2005.
Online sales were up more than 50 per cent and accounted for 21 per cent of turnover. The Create and Craft Club membership rose 160 per cent, which contributed to 17 per cent of the overall growth in the craft business.
The retailer, which issued a profit warning in January, said it has put in place foundations for sustained future growth. The group said: 'The renewal of our Freeview contract and the extension onto Telewest cable have secured our position in the market, which continues to grow and evolve. But it has also meant accepting a step up in our cost base in 2007. We expect our cash margin growth to offset and exceed this over the year.'
Ideal said it was pleased with customer response to more promotion-led trading at the beginning of this year. This delivered comparable sales growth of 20 per cent in the first two months, compared with the same period last year.
Chairman Jim Hodkinson said: 'After Ideal's dramatic growth in 2004 and 2005, last year was a year of consolidation, reflecting shifts in both external and internal drivers of our business. As the TV shopping market continues to mature, we are adopting a more flexible trading stance to keep pace with the customer needs and demands and to accelerate our multichannel activity.
'Internally we have increased our focus on organic growth and on building the group's infrastructure so that it can support a much larger business. We have refined our strategy and made excellent progress in its delivery. I am pleased to say that the group has made a positive start in 2007 - ahead of our expectations.'
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