British retailers McColl's suffered a sharp fall in share prices this morning (Mon) after announcing a sales dip due to supplier Palmer and Harvey going into administration.
The company stated that in the 11 weeks from November 2017, their like-for-like sales had fallen 2.2 per cent arising from the widely publicized P&H collapse. They admitted “having experience some availability issues” leading to supply chain disruption.
Shares for the £288 million company fell by more than 10 per cent today but recouped by lunch time to 239 pence.
The dip won’t cause the retailers too much concern after a successful year following continued expansion and a new partnership signed with Morrisons in August 2017.
Total revenue was up 19.1 per cent to £1.13 billion following the successful acquisition of 298 convenience stores completed in mid-July.
Total like-for-like sales in 2017 were up 0.1 per cent, with pre tax profits of £18.4million.
Chief executive, Jonathan Miller, said: “We have delivered a strong financial performance with a step-up in sales and profitability propelled by our acquisition of 298 convenience stores, and by surpassing £1bn in annual revenues for the first time we have demonstrated that this is now a business of real scale.
“Our convenience-led strategy continues to bear fruit, reflected by a sustained improvement in gross margin as we strengthened our product mix and the proportion of convenience stores has grown to 80% of our estate.
Miller announced plans to continue updating 100 stores in 2018.
“Continuing this momentum, this year we will significantly enhance our customer offer as we transition supply in over 1,300 stores to Morrisons and exclusively launch hundreds of new Safeway branded products at McColl’s. We will also further invest and improve the quality of our estate by extending our successful convenience store refresh programme to 100 additional stores this year,” he said.
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