Tesco saw profits fall by nearly 15% at its One Stop Stores subsidiary last year, as it spent more than £3m on refurbishing shops and staff training.

Despite a 4% increase in sales, which were up from £530m in 2010 to £551m year-on-year, the company saw pre-tax profits fall from £24.8m to £21.2m, according to accounts filed at Companies House.

The results, for the 52 weeks ended 26 February 2011, included a £2.1m investment in the refurburbishment of 28 stores and £1m on smaller re-fits of 43 other stores.

One Stop insisted the results were good, despite the fall in profits, and said it was confident the investment would improve the quality of the chain.

“We are very pleased with these results, which reflect the hard work undertaken by the One Stop team,” said CEO Tony Reed. “Customers have responded well to improvements in quality and availability, in particular the introduction of fresh and chilled ranges. The introduction of a new training programme has had a positive impact on retention levels.”

One Stop also opened 19 stores in the year. However, the results do not include the controversial purchase by the company of 76 stores from Mills Group, which was completed in March despite protests from rivals over the alleged dominance of Tesco’s c-store operations