DCS Europe has reported record sales as it continues to attract customers beyond its traditional cash & carry base.

Sales in the year to 31 December 2010 rose by 6.4% to £126m, accounts filed this week at Companies House revealed. Pre-tax profits rose by 31.1% to £2.38m during the period.

Sales at DCS Central, the UK distributor for health and beauty brands from companies including P&G, Unilever and Gillette, remained steady at £71m.

“Declines within the cash & carry sector were offset with continued growth, not only from the traditional discounters, but also new business within the European hard discounters,” said CEO and chairman Denys Shortt. “The biggest area of growth for 2010, however, came from department stores and ­specialist retailers with sales into the likes of Debenhams, Sit-Up TV and B&Q up 38%.”

Much of the growth with the general retailers came from DCS’ repackaging business, Shortt added.

The company’s export arm recorded sales up 67.8% to £18.5m. It struck distribution agreements for its Enliven brand in 12 new countries and also enlisted a sales agent to explore prospects in Central and South America.

However, DCS Manufacturing had a tough year compared with 2009, when it picked up business from the swine flu epidemic, although it won contracts from Superdrug and Lornamead, and another to manufacture all Wilkinson bathcare products. Shortt said the new contracts would start to benefit the company from this year.

DCS also improved its service levels of punctual and complete deliveries during the year to 98.9%, while supplier service levels declined to 95.8%. “This slight reduction is being addressed,” Shortt claimed, likening the company’s performance to Darwin’s theory that it is not the strongest or most intelligent species that survives, but the one most adaptable to change. “We will always ‘follow the money’ within our multi-channel strategy,” he said.