TheWorks.co.uk said sales were ahead of plan in its new financial year as the retailer reported a £3.6m annual loss caused by Covid-19.
Adjusted pretax loss for the year to 2 May was £3.6m compared with a £2.4m profit a year earlier as revenue fell 19.7% to £180.7m. The group’s statutory loss narrowed to £2.8m from £18m.
The seller of books, stationery and art products said the revenue drop was caused by store closures during the pandemic. When stores were open, like-for-like sales rose 6% and online sales rose 121% as the company and its customers shifted to digital purchases.
The Works announced no dividend and said it would review its payout policy in January 2023 with a view to resuming payments then. The company had 0.8m net cash at the end of the year compared with £7.1m bank debt a year earlier.
Like-for-like sales rose 13% in the 11 weeks to 18 July from two years earlier when results were not affected by the pandemic. Sales were driven by demand for jigsaws and art and craft products, which have been popular during the pandemic, the company said.
The company said it was monitoring the global freight system carefully amid supply backlogs affecting UK retailers and rising costs. So far the higher costs are covered by forecasts, it said.
The Works also said Dean Hoyle would step down as chairman at September’s annual general meeting. Carolyn Bradley, a veteran retailer who worked at Tesco for 25 years, will replace Hoyle.
Hoyle said: “Trading since our stores reopened has been strong and we expect this early progress to continue. We are pleased with the performance since the beginning of the new financial year, which is ahead of our internal plan.”
