Big ticket retailer Furniture Village slipped into the red last year as it invested in marketing, prices and supply chain including the opening of a new warehouse.

The retailer made a pre-tax loss of £1.1m in the year to April 1, 2012, against a pre-tax profit of £3.7m the previous year. However, it made a £2m profit at EBITDA level.

In documents filed at Companies House, Furniture Village chairman Jim Hodkinson said £1.6m of one-off costs relating to improving business efficiencies, including the opening of a new warehouse, “impacted profitability” but has set the retailer on a strong footing.

He said the retailer had “secured a more robust operational platform on which we will continue to invest for the future”.

The new warehouse will enable the retailer to improve its direct sourcing capabilities, according to Furniture Village managing director Peter Harrison.

Turnover in the year dropped from £180.7m to £170.5m after a tough first half due to the timing of bank holidays around the Royal Wedding.

The retailer said it adopted an “aggressive promotional stance and marketing activity increased” to combat softer demand. The retailer introduced free delivery in August 2011.

The actions resulted in “significant volume growth” in the second half and current financial year, said Holdkinson. “The second half and current run rate has seen a return to more traditional levels of profitability,” he added.

“Consumer confidence is fragile and naturally both the housing market and big ticket retail remain impacted. Nevertheless, significant opportunities exist for retailers who recognise the changing needs of the buying cycle,” said Hodkinson.