(Alliance News) - ScS Group PLC on Tuesday recorded an increase in revenue but a fall in profit as a fall in business rates relief impacted the company's figures.
The Sunderland-based furniture and floorings company recorded a pretax profit of GBP16.4 million in the year to July 30, down 28% from GBP22.7 million the year before.
This fall resulted from a widening of the company's operating expenses - to GBP136.1 million from GBP124.5 million - and the reduction in business rates relief, which fell to GBP2.6 million from GBP10.2 million. ScS said that its underlying pretax profit, excluding business rates relief, had increased to GBP13.8 million from GBP8.2 million the year before.
ScS's revenue was GBP331.6 million, up 8.6% from GBP305.2 million the year before.
The company recommended a final dividend of 9.0 pence per share which would give a full year divided of 13.5p per share. Last year the final dividend was 10.0p per share.
Trading since the start of the new financial year has been subdued, ScS said, as high inflation has eroded customer's disposable income. The sector is seeing "softening demand" as consumers defer spending on larger discretionary purchases. The company said that while it expects the coming months to be challenging, it is "confident in the longer term growth prospects of the business."
Chief Executive Officer Steve Carson said: "We are pleased to be announcing results that are ahead of market expectations. The year saw the group deliver record sales, maintain its strong gross margin and manage costs effectively, resulting in a 68% increase in underlying profit before tax, excluding business rates relief. We also saw excellent progress in year one of our refreshed strategy, including strengthening our teams as we look to drive the business forward in the coming years."
Shares in ScS were trading 3.7% higher at 126.00 pence each in London on Tuesday afternoon.
By Chris Dorrell; chrisdorrell@alliancenews.com
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