(Alliance News) - TheWorks.co.uk PLC on Thursday said a large exceptional charge resulting from the Covid-19 pandemic resulted in a loss for financial 2020, but trading since reopening of stores has been well ahead of the board's expectations.
The retailer of gifts, arts, crafts, toys, books and stationery added that despite the positive trading since reopening, it has decided against providing specific guidance from the new financial 2021 due to continued uncertainty and the company will not be proposing a final dividend for the 52 weeks ended April 26.
TheWorks.co.uk had declared an interim dividend of 1.2 pence per share in respect of financial 2020, which was paid in March 2020.
For financial 2020, the retailer reported a pretax loss of GBP18.0 million, swinging fro GBP2.3 million profit posted a year ago. Pretax loss included non-cash impairment charges resulting from Covid-19 of GBP19.5 million, relating to goodwill and store assets.
Excluding exceptional items, pretax profit dived 65% year-on-year to GBP2.4 million from GBP6.9 million.
Annual revenue grew 3.5% to GBP225.0 million from GBP217.5 million, with growth both online and in stores, despite the significant impact of Covid-19 in the latter weeks of financial 2020. Like-for-like sales grew 0.7% versus 3.0% a year ago.
For the new financial 2021, TheWorks.co.uk said total sales were down 26% in the first seven weeks, primarily due to the impact of store closures. However, same store sales have subsequently picked up and are up 0.7% in the 10 week period to August 23.
The company reopened its stores in a phased manner following the lifting of government restrictions in the UK and Ireland from June 15.
"Store like-for-like sales are currently tracking at a high single-digit decline with growth in average transaction value partially offsetting lower transaction volumes. Online performance remains strong with sales levels more than double last year's in the same 10 weeks," the company explained.
Chief Executive Officer Gavin Peck said: "We are encouraged by the trading performance since lockdown lifted and will continue to focus on improving our online capacity and customer experience in stores under social distancing as we head into peak Christmas trading.
"The current uncertainty means that we are unable to provide specific guidance. We will continue to monitor the situation closely and remain agile ahead of our key trading period."
TheWorks.co.uk opened net 37 new stores in financial 2020, taking the total estate to 534 stores.
Due to the Covid-19 pandemic, the company has decided to refocus its strategy, with fewer new stores openings and an increased focus on improving profitability across its existing estate.
Shares in the company were down 4.9% at 22.52p each in London on Thursday afternoon.
By Tapan Panchal; tapanpanchal@alliancenews.com
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Theworks.co.uk. (WRKS)