Matalan EBITDA dipped 14.5% in its first quarter despite a jump in sales.
EBITDA dropped to £23.6m from £27.6m last year, in the 13 weeks ended May 26.
Total sales advanced 3.9% over the period at the fashion and homeware retailer and its closing cash position was stronger than last year, up £16m at £93m.
Matalan chief executive Darren Blackhurst said the performance was in line with expectations and its guidance remains unchanged.
He said: “Our commitment to great style, quality and value continues to resonate with customers, allowing us to deliver both sales growth and significant markdown reductions year on year.”
“As we now move into the second quarter, the business will remain focused on exiting the spring season with a clean stock package and managing costs tightly whilst continuing to deliver exceptional value for customers. This focus will leave us well positioned to capitalise on the opportunities in the second half.”
Blackhurst said the sales trend had been encouraging throughout June.