Online sales drive profit surge at The Works
Discount books and toys retailer The Works has reported its sixth straight year of improvement since private equity firm Endless backed the Sutton Coldfield-headquartered business in 2008.
Annual profits also soared in the year ended 30 April 2014 as growth in the e-commerce offering started to accelerate.
The Works, which has more than 300 stores across the UK, reported total sales of £141m for the period, up 5.5 per cent from £134m in 2013.
Accounts have yet to be published at Companies House and the figures are before VAT has been deducted. According to last year's annual report, turnover hit £123m, up from £121.5m in the previous 12 months, as the business sold about 25 million books.
The latest expansion was by accelerating e-commerce sales – up by 90 per cent on a like-for-like basis – and a strong performance in key product categories, The Works said.
EBITDA also increased by 47 per cent to £8.2m. This figure had fallen from £10.5m in 2010/11 to £5.6m in 2012/13 as the retailer invested heavily in its e-commerce operations.
Chief executive Kevin Keaney said: "We are thrilled to be announcing such a strong set of results. Over the last three years, we have been gradually shifting The Works' product offering in order to become the family-friendly discount retailer we are today.
"The rebalancing of our range towards gifts, art and craft and stationery has been key to our strong sales and profit growth over the last 12 months."
Last year The Works launched a loyalty card programme, continued to expand its e-commerce platform and launched a trial of new store formats in eight of its outlets.
Keaney added: "We have been really pleased with the performance of our new format trial stores and we plan to rebrand and refresh the majority of our store estate over the next three years. We are also delighted with the positive impact our 'Together Reward Card' loyalty programme has had on the frequency of visits from our most loyal shoppers."
The Works was bought out of administration by turnaround firm Endless, partnering with executive chairman Anthony Solomon, in 2008 for £15m.
Solomon added: "It has been an excellent year for The Works and I am confident that we have the team and the strategy in place to continue to capitalise on the significant growth opportunity that we see both on the high street and online."