Online retail business Studio Retail Group, formerly called Findel, reported a 12% rise in adjusted profit before tax to £13m in the 26 weeks to 27 September.
Group profit before tax from continuing operations dropped by 83% to £2.6m, after recognition of additional provision PPI claims announced in September, estimated at £7.9m.
Total group revenue remained flat at £228.1m, compared with the same period in 2018, and online product sales for the main Studio brand were up by 12.8%. Studio product gross profit was up 2.5% year on year in the period, and margin percentage was improved by 160 basis points through improved buying practices, stock control and control over discounting.
Core net debt across the group was reduced from £80.9m to £70.8m.
Meanwhile, the Studio Retail Group also announced today that it has appointed Paul Kendrick as an executive director of the company with immediate effect. He will also continue his role as managing director of Studio. He joined the group in May 2016 initially as commercial and deputy managing director, before being promoted to his current role in April 2017.
The value etailer has also announced it has entered into a conditional agreement for the sale of Findel Education Limited to the Council of the City of Wakefield for £50m, on a debt-free, cash-free basis. Findel Education is a supplier of early years, primary and secondary school supplies, teaching and educational resources. The sale will be subject to shareholder approval.
“This has been another period of strategic progress as we strengthen our position as a digital-first value retailer”, said group CEO, Phil Maudsley. “We are pleased to have reported a strong increase in adjusted profit before tax in the first half.
“We know that Studio’s customers look for value all year round, so we do not need to chase promotional trends to maintain our market position. In support of this approach, we look forward to further initiatives coming on stream next year to enhance our digital-led value offer.
“We will look to refund the remaining customers’ PPI claims during the second half of the year. Education has delivered on the foundations laid last year, and its leadership team should be congratulated on their hard work. We are delighted to have agreed the terms of a sale with YPO and we look forward to this completing in 2020.
“The retail marketplace is undoubtedly challenging, but Studio’s unique position as a digital-first, value-focused retailer with an integrated credit option gives us great confidence for the future.”