The Perfume Shop posted a decline in its full-year profits, which it attributed to increased competition from etailers and rising costs.

The fragrance chain reported an 11% decline in its operating profits to £15.2m in the 53 weeks to December 31, as revenue edged up 1.1% to £212.3m.

The retailer attributed the fall in profits to operational cost rises such as the national living wage, as well as increased competition from pureplays, general merchandise and clothing retailers.

The Perfume Shop’s store like-for-likes were flat during the period, although comparable sales across its digital and physical outlets increased 2% driven by a 33% spike in online sales overall.

The specialist retailer’s results compare with a 52-week period in the previous financial year.

Store estate

The fragrance chain, whose AS Watson Group stablemates Savers and Superdrug both reported hikes in their respective full-year profits, shuttered eight shops during the financial period and ended the year with a bricks-and-mortar estate of 258 stores.

The Perfume Shop pressed on with its store refurbishment programme and refitted 64 outlets during the period with a pipeline of between 60 and 70 store refits set for the next three years.

The retailer said that although the consumer environment had been “supportive” during the financial period, ongoing uncertainty around Brexit would continue to pressure its business in the year ahead.

A statement from the fragrance specialist said: “The impact of the UK’s decision to exit the European Union has created uncertainty regarding future consumer sentiment and demand, and has created upwards pressures on costs arising from the devaluation of sterling.

“In the longer term, uncertainty will also exist surrounding the access to the single market, taxation regimes and the free movement of labour.”