McColl’s strategy of concentrating on premium convenience stores has been vindicated, according to chief executive James Lancaster, despite a 2.3% fall in third quarter like-for-like sales.
Lancaster said while like-for-like sales were down overall, during the 13 weeks to 30 August, “our premium and food and wine convenience stores continued to outperform our newsagents and standard convenience stores”.
The group, which has 866 convenience stores out of a total portfolio of 1,346 outlets believes the outperformance underlines the group’s strategy.
The period saw like-for-like sales, excluding fuel, lottery and mobile phone top-up, fall 2.3%, with like-for-likes in premium convenience and food and wine down just 0.4% compared with a fall of 4.6% in standard convenience stores and newsagents. Like-for-like sales for the year to date have fallen by 2%.
Total group sales climbed 3% during the quarter and 3.3% for the year to date, driven by acquisitions.
McColl’s acquired 21 new stores in the quarter, converted 10 newsagents to the food and wine format. In the year to date, the group has completed 26 food and wine conversions, introduced alcohol to 100 newsagents under “Project 100”, opened its 500th post office and it signed an agreement with Subway to trial a franchise operation in Tamworth in October.
The group continued to achieve strong sales performance from food to go, after introducing coffee and snacking modules to 119 stores in the first half of the financial year.
Lancaster said: “We have made further solid progress in the third quarter in what continues to be a challenging time for the sector.”
“We have also taken advantage of improvements in the credit markets since flotation and I am delighted with the revision to the terms of our banking facilities which will result in lower interest costs. We remain on track to achieve results in line with the board’s expectations for the full year.”
McColl’s shares slipped 0.6% in morning trading to 155.2p - the shares are currently down by 15.4% so far this year.