Chelmsford Star reports trading profit of £493k

The society says its performance is ahead of its business plan expectation, returning the business to retained profit

Essex-based retail society Chelmsford Star has reported a trading profit of £493,000 for the year to 29 January, a two-year decrease of £200,000.

The society’s gross takings have decreased by 3.2% (on a 52-week comparison) or by 12.7% across two years, the report says. The report, in line with many other retailers, is using a two-year comparison to take into account the temporary boost to sales in the lockdown year.

After meeting the costs of all distributions, the society posted a retained profit of £341,000, which compares to losses of £3,546,000 last year and £617,000 two years ago. The performance is ahead of the expectation of the business plan, the report says.

The board will be recommending a dividend rate of £4 per 1,000 points earned up to 29th January 2022.

Chelmsford Star’s food business saw gross takings of core products rise by 4.4% on a year-on-two-year like-for-like basis, helped by Covid restrictions keeping shoppers local. Trading profit of the food business has increased 24% over two years.

Like other retail co-ops, the society says its food business was hampered by supply issues, resulting from Covid related shortages in both food supplies and the availability of HGV drivers. Stock availability over more recent weeks has gradually improved, it adds.

Gross takings at its department stores have fallen 40.1% on a year-on-two-year basis, with the division closed for just under a fifth of of the year. The pandemic also hit the travel business, with gross takings on a year-on-two-year basis down 86.6%.

The society is working to mitigate losses in the division, looking for new concession partners and developing its online shopping offer. But trading losses in the division increased to 6.87%, compared to 3.09% two years ago, and the board continues to monitor its performance.

Gross takings for the travel amounted to £1,389,000, a decline in turnover across two years of £9,010,000 (86.6)%. “Given the impact of Covid-19 on international travel,” says the report, “the society’s travel business generated a trading loss of £120,000, which compares to a trading profit two years ago of £201,000”.

This year, the business is launching an online option for customers to book a selection of European holiday packages.

At the funeral division, takings rose 1% on a year-on-two-year basis. The society is to open its ninth funeral site this year in Basildon, and is also developing its online funeral planning options.

The report warns: “With the fear of a cost of living crisis around the corner, it is unsurprising that consumers remain cautious and will continue to do so into 2022. Your society is not immune to these factors, which have undoubtedly contributed to the result presented within this report.

“The board continues to regularly review the society’s trends and react where necessary to face into the challenges.”

During the year, the society achieved the Fair Tax accreditation, meaning it pays the right amount of corporation tax at the right time and in the right place.

Its charity partnership with Essex Community Foundation’s Coronavirus Fund raised £20,355, and the society’s Community Fund gave a total of £9,000 to four Essex charities.