McColl’s removes 41 stores as profits decline
McColl’s has removed 41 “underperforming” newsagents and convenience stores from its estate as profits declined annually by £2.1m.
In its latest trading update for the six months ending 26 May, the company said it had refurbished 17 convenience stores, opened three new shops and converted 10 sites to the Morrisons Daily franchise.
The store closures follow previous attempts to move from a news to a convenience-focused business. The 41 sites offloaded had an average size of 1,000sq ft, sales of £10,000 and 28% of sales from grocery and alcohol. In comparison, the acquired sites were on average 1,700sq ft, turned over £20,000-£25,000 and made 45% of sales from grocery and alcohol. The company also said it is looking to acquire more existing convenience store sites in the second half of this year.
Profit before tax fell from £2.3m to £0.2m. Total revenue for the six-month period fell by 0.1% to £611.1m, while like-for-like sales rose by 1%.
McColl’s chief executive Jonathan Miller said: “The key priorities we outlined for this year were to stabilise the business and to refocus on retail execution following a challenging 2018.”
The company blamed the weather, ‘challenging trading conditions’ and the collapse of Palmer & Harvey for the poor results.
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