Furniture retailer Cargo - which operates the Cargo and Homestyle fascias - more than tripled its pre-tax profits in the year to June 27, 2009, as it slashed costs and benefited from the buying power of its parent, Steinhoff.
Revenue declined from £32.9m to £30.7m in the year as the retailer closed some stores, but pre-tax profits surged from £694,000 to £2.5m.
Cargo managing director Clive Gilbert said since the end of the financial year, while the market has “remained tough” it has experienced a positive like-for-like performance.
He said Cargo was aiming for “a positive sales increase” overall this year, but added: “The market is very volatile. We had a solid Easter but there’s a huge amount of uncertainty with the election.”
Gilbert said Cargo managed to grow profits by slashing costs.
During the period the retailer closed six stores, including some of its larger branches. The retailer has also shut its store on London’s Tottenham Court Road since the year end. It operates 47 Cargo stores and 19 Homestyle stores.
He added: “We have reduced our number of suppliers and built really strong partnerships, and we are being rewarded with better terms.”
He said Cargo grew market share in the period as other retailers, such as Woolworths and The Pier, collapsed and some such as Lombok and Sofa Workshop closed stores.
Cargo has also restructured its head office since its year end. It conducted a similar number of promotions in the period compared with the year before, and reduced its marketing spend.
The retailer, which opened a store yesterday in Fareham and will open another in July, is on the lookout for more stores.