// McColl’s total revenue down 1.8% to £1.22bn for the full year ending November 24
// Total like-for-likes flat, while adjusted pre-tax profit for the year fell from £10.5m to £7.3m
// McColl’s attributed results to store closures and divestments as part of store optimisation programme, and softer market conditions
// McColl’s also confirmed it is in discussion with lending banks about a new debt facility
McColl’s has posted declining profits and sales in its preliminary results for the full year, attributing it to its store optimisation programme and softer market conditions.
The convenience grocery chain also revealed it was in “advanced” discussion with its lending banks to amend and extend its existing debt facility, and that an announcement is expected shortly.
For the full year period ending November 24, McColl’s said total revenue went down 1.8 per cent year-on-year to £1.22 billion, reflecting store closures and divestments as part of a store optimisation programme.
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Total like-for-like sales for the year was flat, while adjusted full-year pre-tax profit dropped from £10.5 million to £7.3 million.
Meanwhile, softer market conditions through the summer led to a drop in adjusted EBITDA – from £35 million in 2018 to £32.1 in 2019.
McColl’s also said that a one-off, non-cash goodwill impairment charge of £98.6 million, together with other adjusting items, led to statutory loss before tax of £98.6 million – a dramatic increase from the £7.9 million recorded the year before.
The retailer’s board also reached a decision to suspend the final dividend and keep the policy under review.
For the current year so far – or the 11 week period ending February 9 – McColl’s said like-for-like sales improved 0.5 per cent.
However, total sales decreased by 4.2 per cent, reflecting the annualisation of the ongoing store optimisation programme.
McColl’s said 2020 will be “a transitional year” with the implementation of its strategic change programme, and as a result its expected adjusted EBITDA for the year to be broadly in line with 2019’s results.
“We have stabilised the business and refocused on retail execution in 2019, in line with our key priorities for the year,” chief executive Jonathan Miller said.
“Against challenging trading conditions we have made good operational progress, whilst reducing debt and making appropriate levels of investment.
“Looking ahead to FY20, we are embarking on a strategic change programme, refining our model and better tailoring our offer to the customers and communities we serve, using the learnings to build the foundations for future growth.
“The fundamentals of the convenience sector remain strong and, with our improving customer proposition, I am confident in delivering sustainable returns for shareholders over the long term.”
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