Value health and beauty chain Savers reduced its losses in the last financial year and is confident it is moving towards profitability.
The AS Watson-owned retailer reported a pre-tax loss of £18.1m for the year to December 27, 2008, down from a loss of £45.9m the previous year. Total sales were down to £161m from £180m the previous year.
A spokeswoman for the retailer, which is sister chain to AS Watson’s flagship UK retailer Superdrug, said: “While Savers incurred an operating loss the business started to see a significant and regular increase in like-for-like sales in excess of 10% in the second half of 2008 and throughout the first half of 2009.”
In documents filed at Companies House, the retailer said that during the year it entered into an agreement with a group company making available an interest-free credit facility of up to £50m, maturing on June 30, 2012.
The spokeswoman added that the directors are “confident the business is making progress towards profitability and the strategy and format is well placed in the current climate”.
She said: “Improvements to the proposition were made during 2008 with the introduction of new ranges such as household and this improvement continues into 2009 with the introduction of additional ranges such as medicines and vitamins and continued focus on value personal care lines.”
In its accounts, the retailer said that grocers have gained further share of the health and beauty market through expansion of store estates and by extending their diversification into new markets. It said this is “taking sales away from high street specialists and forcing the latter to maintain lower prices”.
Savers said its strategy is based on three principal drivers - store locations in secondary sites with lower rents, prices of branded products significantly below competitors’, and good store standards providing a convenience experience.