LONDON (Alliance News) - Fishing Republic PLC on Wednesday said trading in the first half of 2015 has been in line with its expectations, as it posted a rise in pretax profit on the back of slightly higher revenue and a big improvement in margins.
In its maiden results as a listed company, the fishing tackle retailer, which floated on AIM at the start of June, said its pretax profit for the six months to the end of June was GBP148,897, up from GBP107,523 a year earlier. The company's administrative and operating expenses both increased in the half, but a decline in its cost of sales and a rise in revenue offset these effects.
The profit also was helped by a big improvement in the group's gross margin, up to 38.5% from 32.6% due to better procurement and a better use of working capital, the company said.
Revenue for the company was up to GBP1.9 million from GBP1.8 million, with an in-line performance from its stores in the half. The group said it intends to relocated its store in Hull to larger premises, more in line with its typical "destination" store format, and said it has made progress on its plan to open a store in Birmingham. Online sales were also solid in the half, the company said, and it intends to grow its own-brand product portfolio.
The company said it intends to grow its stores and invest further in its online business and said trading in the second half so far has been strong.
The company said it will not pay an interim dividend as it intends to use is surplus cash to invest in expanding its operations.
"Trading results are in line with our expectations, and we are pleased to see a material improvement in gross margins, helped by better procurement and working capital utilisation," said Steve Gross, Fishing Republic's chief executive.
"We intend to add further large format 'destination' stores and are also focused on growing our online sales and have added additional resources in this area since our admission to AIM. In addition, we see an opportunity to increase sales of 'own brand' products over the next few years," Gross added.
Shares in the company were untraded early Wednesday, having last traded at 18.70 pence.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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