ScS FY pre-tax profits slip

Furniture and floorings retailer ScS Group said on Tuesday that pre-tax profits had slipped year-on-year in the twelve months ended 30 July, partly driven by a modest contraction in operating margins.

ScS Group said pre-tax profits had dropped £6.3m year-on-year to £16.4m, while operating profits fell £6.6m to £20.2m. Gross profits ticked up 6.3% to £156.3m but a 0.72% contraction in gross margins to 45.3% somewhat offset this growth.

The London-listed firm also said earnings per share fell 14.2p to 36.2p, while on an underlying basis, earnings per share were down 5.1p year-on-year.

ScS, which recommended a final dividend of 9.0p per share, also highlighted that it had a "strong balance sheet", with cash of £70.8m - down from £87.7m a year earlier.

However, Scs stated that inflationary pressures and reduced consumer confidence continued to impact visitor numbers, meaning initial trading in the year had been "tougher" than it saw coming, with order intake for the first ten weeks of the new financial year down 7.8% on a like-for-like basis.

"We are mindful of the challenges of the current economic climate, but believe our flexible operating model, refreshed strategy and robust balance sheet places the group in an excellent position to deal with the headwinds our industry is facing. The tightening economy, coupled with the execution of the next phase of our strategy, will provide opportunities to take market share," said ScS.

As of 0920 BST, ScS shares were up 0.29% at 121.85p.

Reporting by Iain Gilbert at Sharecast.com