Flying Brands has become one of the few home shopping groups to suffer poor results.

The retailer revealed actual profit before tax tumbled 31 per cent to£3.6 million in the year to December 28, down from£5.3 million in 2006. Like-for-like sales for the year plummeted 13 per cent.

A tough second half was compounded by the wet weather over the summer – which hit performance at its Gardening Direct business – and the Post Office strike in October, which affected deliveries.

Paul Deacon, analyst at house broker Landsbanki, said: “We worry that the business seems to be struggling for direction and the task is made more complex by the diversity of the business portfolio and its lack of scale.”

Chief executive Mark Dugdale, who will leave next month, said that the retailer would invest£2 million this year.

“This will be invested into the core business to secure its future, including investments in the internet and international operations,” he said.