Updated: Academic books retailer Blackwell has narrowed its operating losses from £11.3m to £10.2m in the year to June 27 but is conducting a further review of the business against a backdrop of increased competition from online booksellers and supermarkets.
The retailer said losses narrowed to £6.9m after stripping out exceptionals, including reorganisation costs and the closure of the pension scheme, which cost £2.3m.
Turnover increased 3.3% to £158.3m in the period. Blackwell said the retail business recorded like-for-like sales growth of 1.7%, in a “highly competitive” market.
The retailer said trading in the first half of the current year - from July to December - had been “positive”, with retail sales growing 1.6% in a “challenging market”.
Blackwell chief executive Andrew Hutchings said: “These results show that the Blackwell organisation is making steady progress to a sustainable financial position. The core business is performing well in a challenging marketplace. In the past year Blackwell has taken major steps to create a focussed and profitable business model for the future.
Hutchings told Retail Week: “In the year we set out to do a lot of restructuring so we knew we’d lose money. The most important thing is the shape we came out of the year in. And we are in a much better place.”
Hutchings said that while the wider book market has suffered declining sales in recent years, the academic sector had performed better than others.
He added: “We also benefited from not being tempted into deep discounting.”
In documents filed at Companies House, Blackwell said: “Against a tough trading climate the retail business in the UK experienced another challenging year. The bookselling industry endured an unprecedented level of discounting, which damaged sales and margins across all categories.
“This was also evidenced in the market share growth for both supermarkets and online retail where sales were bought at the cost of low margins or break even deals.
“Despite these challenges our online sales followed the industry trend with strong growth.
“The Board has embarked on further restructuring combined with a continuous improvement plan in a number of critical services areas to further recue the level of losses.”
The retailer sold its Blackwell North America arm in the period, which it estimates will generate profits of £5.3m in the current financial year. It also secured a new three year term loan of £7m in December.