HIGH street stalwart M&Co is pushing ahead with plans for further international growth after slashing its full-year losses.
The Renfrew-based firm, which ranks as one of the UK’s biggest privately-owned fashion chains with nearly 300 stores, unveiled its overseas push last year with a franchising deal covering the Gulf region.
Unveiling year-end accounts and an update on trading, chairman Iain McGeoch yesterday reported that the firm had seen an “encouraging” level of sales through the new outlets.
He said: “We remain excited by our developing international business, having opened five franchise stores overseas and a further seven planned for later in the year.”
McGeoch also highlighted strong domestic and overseas growth at the chain’s online business.
The newly-filed accounts show that parent company Mackays Stores Group racked up a loss before tax of £2.3 million in the year to 22 February, which compares with a deficit of £8.6m a year earlier.
A dip in turnover to £168.9m, from £173.3m, was blamed on a combination of “extremely-poor summer weather” last year and a small net reduction in store numbers.
The firm said its underlying financial performance was “much improved” over the previous year and pointed to a positive operating profit of £400,000 as well as earnings before interest, tax, depreciation and amortisation (Ebitda) of just over £10m.
McGeoch said net debt had been cut by £9.4m with a further “significant” reduction in the current year to date.
“Our improved performance has continued and our year to date operating profit is well ahead of 2012-13,” he added.
“Our improved focus on appropriate trend-led pieces for our target customer offers excellent quality at competitive prices, providing our customers with fashionable garments in line with current trends.
“Our online business continues to grow strongly in the UK and internationally and omni-channel trading continues to be an integral part of our business strategy.”
During the year under review, seven stores were opened while 12 “non-profitable” branches were closed.
Writing in the accounts, Mackays’ directors noted: “We look forward to the forthcoming year with confidence and expect to make further progress towards the profit levels achieved in past years.”
The £8.6m pre-tax loss suffered in 2011-12 was the company’s first in 50 years.
According to the latest accounts, the group’s headcount dropped by 110 to 3,742, probably as a result of the net reduction in stores.
The overall bill for wages and pension costs fell to £41.4m from £45.1m. Meanwhile, the highest-paid director – likely to be McGeoch – saw their pay package, including benefits, cut from £309,219 to £224,037.
No dividend was paid during the period, following a payout of almost £2m the year before. The firm’s shareholders are listed at Companies House as the McGeoch and McKimmie families and their trusts, along with James Bell and Charles Parkin.