99p Stores has revealed that its profits dropped 55% last year and said it is working on opening a transactional website. .
A report by Retail Week showed that EBITDA at the discounter was down £6m to £4.9m in the year to 31 January 2013. However, the fall was attributed to investment in buying teams, retail operations, IT, finance and HR to support its growing 231-store estate. Gross turnover was said to have increased 27% to £391m in the year, with gross profit edging down 0.28% in the face of rising raw material prices.
Commercial Director Hussein Lalani is quoted as saying: “Last year was a consolidation year in which we built infrastructure for continued growth and these results were in line with expectations.”
Lalani said since year-end “trading has been steady. We have seen year to date margin improvement of 1.4%”.
99p Stores is planning to open another 120 stores in the UK by 2017, aiming for a 350-store estate. Lalani added that there was scope for 1,000 UK stores and further expansion of its product offering having invested in chilled food distribution.
Meanwhile, the single price retailer revealed that it has invested in bringing all website design and development in-house so it can create its first transactional site. It was not revealed when the site would be launched but rival Poundland has also said it is working on a transactional online store.