Outdoor retailer Mountain Warehouse has notched up record first-half sales, but its boss warned that the collapse in sterling will mean higher prices for shoppers from next year.
The company said sales for the first six months of its financial year climbed 29.5 per cent to £76.8 million, although pre-tax profits edged down to £4m, from £4.3m a year ago, with the decline attributed to “a period of significant investment in new stores”.
Founder and chief executive Mark Neale said the chain would have to deal with increased costs sparked by the falling pound “in three ways”.
He said: “A third will come out of securing better prices from factories, a third will be absorbed by the business and a third will be passed on to customers with selective price increases. We are not alone in that – most retailers will have to do the same, so we will still be better value versus others.”
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Mountain Warehouse, which has more than 20 outlets in Scotland, has also taken immediate plans for a stock market flotation off the table, with Neale adding that Britain’s decision to quit the European Union “made the decision to not proceed with it a lot easier”.
He also took umbrage with Home Secretary Amber Rudd’s suggestion that businesses should be forced to compile lists of foreign workers.
“We have a lot of foreign workers, from inside and outside the EU, but we’ve never thought to count them. We recruit on a talent basis, not nationality. Businesses depend on foreign workers. It’s a bizarre policy, and it looks like it’s already been dropped.”
Mountain Warehouse is planning to ramp up its expansion, with the aim of eventually having 300 UK stores and 300 international outlets.
It currently has about 250 in the UK alongside 50 overseas stores spanning Canada, Germany, Ireland, Poland and the US. In the first six months of the year, Mountain Warehouse opened 24 branches – half of which were overseas – creating 250 jobs.
On the prospect of a Brexit-induced consumer downturn, Neale said: “Ultimately, I think Brexit will be fine. During the last recession we grew the business, so we’ve seen it all before and we actually benefited from people searching for better value.”