Despite McColl’s suspending its final dividend for 2019, the convenience chain’s CEO Johnathan Miller is “confident in delivering sustainable returns for shareholders over the long term”.
His comment came as McColl’s released preliminary results for the 52 weeks up to 24 November 2019, which was a year of flat (0.0%) like-for-like sales for the business.
The number is, however, an improvement on the previous year’s 1.4% drop. There are also encouraging signs for this year; a trading update for the 11 weeks to 9 February 2020 revealed that like-for-likes were up 0.5%.
Total 2019 revenue was down 1.8% to £1.22bn (2018: £1.24bn), which McColl’s said “reflected store closures and divestments as part of its store optimisation programme”.
Adjusted gross margin was broadly level at 25.9% (2018: 26.0%), while adjusted earnings before tax of £32.1m were a £2.9m drop on 2018.
Adjusted profit before tax was also down, to £7.3m from £10.5m in 2018.
McColl’s said 2020 will be “a transitional year” as it implements a strategic programme that will see a “revitalised” customer offer; stores that are easier to operate and to shop; and an optimised estate of around 1,100 larger, more convenience-focused stores.
“We have stabilised the business and refocused on retail execution in 2019, in line with our key priorities for the year,” said Miller.
“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.”