TJ Hughes returns to profit, plans expansion

By

Barbara Santamaria

Published
Nov 13, 2018

Liverpool-based discount retailer TJ Hughes has swung back into profit and is ready to take advantage of market opportunities following the collapse of some of its rivals.

Lewis’s Home Retail, which trades under the TJ Hughes brand, said pre-tax profits climbed to £1.37m for the year to January 31, 2018, compared with a pre-tax loss of £0.71m the prior year.

The turnaround came on the back of growing revenue, with sales (excluding concessions) up almost 4% to £69.8m and gross margin remaining significantly positive at 39%.

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And despite the current challenges facing the high street, the chain is planning to expand its portfolio of stores with additional shops in key locations. It currently trades from 27 sites across the UK.

“Although the retail market outlook remains a challenge, the business is well positioned to achieve further growth into new areas in the UK and is continuing its store roll-out programme,” management said in a statement.

“New stores will be opened where the business is able to negotiate satisfactory store lease terms in attractive locations, consistent with the focus to maintain margins and achieve a satisfactory return on investment.”

TJ Hughes’ results provides some hope for the embattled UK retail sector after a year of several high-profile collapses. Over the last 12 months, chains including Poundworld, House of Fraser and 99p Stores went bust.

During the same year, TJ Hughes moved to a new distribution centre with more capacity, and planned to relocate its headquarters to the same site. It said the investment in new warehouse premises and infrastructure will be central to ensure a better customer delivery performance.

“A combination of the company’s portfolio of diverse, market-leading brands – along with the control of costs and an enthusiastic dedicated workforce – lead the board to the view that the company’s future performance will be robust and rewarding,” the company said.