New figures posted at Companies House reveal that turnover for the year ending December 2007 had fallen to £138m from £146m the previous year, while operating profit was down to £2m from £3.6m. MD Ian Connell said the company, which supplies stores in the south and south west, had lost £1.2m on transactions with its Irish parent company BWG as a result of sterling weakening against the euro.
“If you strip away the losses from the exchange rate, our underlying costs and gross margin are about the same as the year before,” he said. Sales at his core Spar business were up 5% on the previous year, he said, but added: “Clearly, the economy is under pressure and the weather has been tough for south west-based tourism-related industries too, so it’s hard work at the moment.”
The company also lost the contracts for 11 RNS Higgins stores, which were sold to Southern Co-operatives in 2006. It had also lost contracts to supply 38 armed forces Naafi stores over the past three years, the bulk of which were terminated in 2007. However, the business had grown in 2008, insisted Connell. Twenty-six new stores had been signed up, he said, and he hoped to increase that to 30 by the end of the year. It plans to open a new Eurospar in 2009.