McEwens of Perth, one of the UK’s last independent family-run department store chains, has fallen back into the red a year after showing signs of a turnaround in its fortunes.
Chairman and managing director John Bullough blamed the slump on reliance on several key concessionary outlets within the Perth store which had underperformed.
They have been replaced by new partners or more profitable own-bought departments in the retailing institution established in 1868.
The year also saw the closure of the loss-making branches in Aberdeen and Inverness, which entailed significant write-offs.
McEwens’ consolidated turnover for the 12 months to January this year was down 19% at £5.337 million.
After interest and other charges, the group made a pre-tax loss of £25,709, a setback after last year when its profit before tax of £80,602 was McEwens’ first in four years.
Mr Bullough, who is also chairman of Perth City Development Board, said last year that the 2014 results were a small but significant step for the group.
McEwens, he said, was refocusing on “bringing the joy back into destination shopping” in the store that prides itself in offering affordable quality.
Despite a challenging environment for high street retailing, he predicted McEwens’ five-year recovery strategy was starting to pay off.
In the latest accounts for the ultimate parent company McEwens Direct Ltd, Mr Bullough said in the year to January 2015 there had been a continued national background of difficult trading conditions for department store retailers and the closure of some stores.
The group had seen a 23% decrease in sales and a slight reduction in gross margin.
The directors had taken steps to improve turnover at a reduced number of sites. The flagship store in St John Street, Perth, now exists with smaller outlets in Ballater and Oban.
McEwens had expanded its food hall and invested in the refurbished Peacock Restaurant as well as footwear and children’s departments.
An online shopping site was bringing in more sales, and further improvements were planned.
The group had reduced staff numbers by 17 to 116 and also cut property and administration costs to create what Mr Bullough described as a far better set-up.
He was encouraged that the retailing-only operation’s pre-tax loss in 2015 was reduced by 30% at £56,328, reinforcing his belief that group was recovering.