Family-owned business Leekes Retail & Leisure Group has announced another year of strong profitability despite the challenging economic conditions and inflationary environment.
The group reported EBITDA of £6m and a PBT and exceptional items of £3.1m for the year ended 31st March 2024.
"The home retail market was significantly affected by lower consumer demand for high-value home purchases, brought about by the combination of both high inflation and higher interest rates," states the group. "However, a gross margin improvement of 270 basis points to 42.6% and significant operational efficiencies ensured that the retail business remained cash generative with EBITDA of £2.8m and a profit before tax and exceptional items of £1.2m."
Commenting on the results, Emma Leeke, MD of Leekes Retail, says: “We are delighted to report continued strong results despite the well-publicised challenges faced in the retail sector. Our excellent profitability over the last four years has enabled us to continue our programme of investing in significant capital expenditure in our retail business. We are excited by the successful opening of our newest store in Cheltenham last week and the imminent start of the final phase of the refurbishment of our flagship store in Llantrisant, South Wales.”
The Vale Resort at Hensol, South Wales, which celebrates its 25th anniversary this year, reported another strong trading year, with a turnover growth of +7%. The group's newest business, its distillery operations based at Hensol Castle adjacent to the Vale Resort, also saw growth and investment.
The group also recently completed its triennial refinancing facility, with a £25m Revolving Credit Facility agreed with Barclays Bank. Mike Fowler, group FD, comments: “Barclays have been bankers to the group for 20 years and their support has been a key element in our balance sheet growth with net assets more than doubling from £41m to £92m over that 20-year period and gearing reducing to 15%.
"Having reduced our net bank debt by a third since the start of the pandemic on the back of strong trading and several property deals across the group, we can continue to invest heavily in our core operations with £15m of capital expenditure planned in the next three years. Whilst there has been significant cost pressure, we continue to benefit from favourable hedging agreements on both interest rates and utility costs to ensure that our strong profitability and cash generation continues.”
