Dundee wholesale and retail food distribution group CJ Lang & Son has celebrated a modest increase in turnover and said the outlook for the next 12 months is positive.
Despite continued difficult trading conditions, the Spar Scotland convenience store supplier’s revenue crept up 0.9% to £194.7 million due to opening more stores.
The expansion accounted for an increase in operating costs which rose by 0.7% to £151m.
The fall in pre-tax profit reduced, and in the last year it was down 11% at 1.12m, less than the previous year’s 36.3% fall to £1.26m.
In 2011 the pre-tax profit at the group was almost £5.5m.
Company secretary Scott Malcolm said the need to address current and anticipated future increases in overheads that are sensitive to external influences meant a substantial part of the capital expenditure programme for the year to April 2014 was strategically devoted to significantly improving distribution and energy efficiency.
He continued: “It is pleasing to report that an immediate benefit was derived in the period under review in the form of cost reductions which contributed towards achieving a net profit £810,000 that was broadly in line with the previous year.”
There was a planned increase in net debt of £3.5m to fund the high investment in capital projects and store acquisitions, but the uplift of shareholders’ funds of £494,000 led to a strengthening of the balance sheet.
Mr Malcolm continued: “Our strategy is aimed at increasing the number of independent retailers in Spar, growing our own stores portfolio and investing in new initiatives to stimulate footfall and turnover while continuing to exercise prudent cost control.
“An encouraging start has been made to the new financial year, so whilst the trading environment is expected to remain challenging and become increasingly competitive, the outlook for the next 12 months is, on the whole, positive.”
The convenience store sector has become considerably more challenging with multiple operators like Tesco and Sainsbury’s having entered the scene in which the Co-Op group is also a major competitor.
CJ Lang’s directors believe their group, through its association with Spar, is well placed to grow its own market share over the long term.
It has more than 300 convenience stores across the country.
Based in Dundee since 1919, CJ Land & Son is Scotland’s largest independent retailing and distribution company.