LONDON (Alliance News) - Value-priced butcher Crawshaw Group PLC said Wednesday its interim loss deepened as customer number dropped sharply, while it looks to turn focus away from high street stores to other, growing areas of the business.
For the six months ended July 29, pretax loss deepened to GBP1.7 million from GBP1.2 million the year prior. This was despite revenue remaining comparatively flat at GBP21.6 million from GBP22.1 million the year before.
Performance was hurt by 13% falls in like-for-like sales during the period, after customer numbers dropped 9.1%.
"Clearly the results for the first half of the year are disappointing, but not entirely a surprise given market conditions and the issues that face a retail estate that has too many high street stores and currently not enough factory stores," Crawshaw Chief Executive Officer Jim Viggars said. "However, the important issue is the future growth and profitably of Crawshaw."
During the period, the firm opened two more of its factory stores to make 12 altogether within its 54 store total. The factory store format now generates 30% of sales. The firm plans a further 10 factory store openings in financial 2020 and another ten in financial 2021.
"The new management team has identified what it considers to be the key issues and are moving at pace to remedy them on a sustainable basis," Viggars added. "This is achievable over the medium term, despite market conditions which include declining high street shopper numbers, increasing convenience and online shopping and retail pricing that is more competitive."
Chairman Jim McCarthy added: "We recognise that some of our existing high street stores are not core to our future growth. Our factory store format is attractive to consumers, and we intend to accelerate the growth of this proven model, constantly refining value, operational standards and the overall shopping experience that is key in driving sales and profitability.
"We are also trialling initiatives in both convenience and online channels in order to meet changing customer shopping requirements," McCarthy said. "We believe we will be able to achieve this at relatively low cost and that over time these channels will support the factory store format in delivering sustainable growth and profitability."
Trading since the start of the second half of the year was described as "in line" with management expectations. The firm expects revenue to be flat on the year prior and the operating loss to be around GBP3 million.
For the year ended January 28, Crawshaw generated a GBP2.0 million operating loss on revenue of GBP44.6 million.
Shares in Crawshaw were 10% higher at 3.57 pence on Wednesday.
