Stormy times push Booths into the red

INDEPENDENT Lancashire-based grocer Booths has fallen into loss, as a severe flooding and last year’s Storm Desmond severely impacted Christmas sales.

As a result of the flood damage, staff changes and new store openings Booths posted a £6.3m pre-tax loss for the year to March 26, compared to profits of £1.1m last year. Trading profits also fell from £3.1m to £2.6m.

The upmarket family-owned grocer, which has 31 stores in Lancashire, Cumbria, Cheshire, Greater Manchester and also in Yorkshire, underlined in its company accounts a statement made back in January, that its like-for-like sales had been hit by the ultra-competitive retail market and by the severe floods in its Northern heartlands.

It also said that deflation had “plagued our market for a considerable period”.

“Allied to a tight consumer market and heavy discounting, this has kept the lid on potential for sales growth”, it said in its accounts.

Sales fell 7% to £276.6m during the year and of that 1.4% was directly related to the to flooding in the Lake District – the Keswick store ended up under water following a breach of flood defences in the town and remained closed for months, with the refurbished store opening in April.

Without the December storm, it would have recorded a 0.7% increase in sales.

During the year the Preston-based company had a complete over haul of its leadership team within stores as its existing management structure “was struggling to cope with the high demands attributable to improving customer experience while at the same time working more efficiently”.

The retailer removed a layer of senior management, which resulted in £1.6m of one-off costs but would save it £2.6m a year thereafter.  

The company said that trading in the current 2016/17 financial year had been worse than expected, although it said intake margins were strong and operating costs were under control.

Booths paid out a dividend of £288,762 to its family owners.