Ideal Shopping Direct has reported a pre-tax profit in its interim results against a loss in the same period the previous year and said its business turnaround is now complete.
For the 26 weeks to July 4, the TV shopping and online business reported pre-tax profit of £2.9m against a loss of £1.2m the previous year. EBITDA was £3.8m, against a loss of £0.4m the previous year. Sales increased 19.3% to £56.6m, and like-for-like sales increased 11.4% to £52.8m.
Its home and leisure category reported sales up 37.6% to £29m, crafts sales were up 18.6% to £13.2m, internet sales were up 58.2% to £16.3m, now representing 32.7% of sales.
The retailer said “all significant problems have been addressed” and it has “seen huge improvements in all areas of the business including product offering, reduced stock holding, customer service, systems development, processes and controls” and a “strengthened management team and improved culture”.
In July it announced a strategic review, and it has since appointed Rothschild as advisors which began work at the end of August. Ideal said the review is at an early stage but it will include considering a sale of the business alongside other options.
Current trading in the first eight weeks of the year to August 29 is “in line with management expectations”, increasing by 10.3%. This brings sales growth in the first 34 weeks of the year to 17.1%.
Ideal purchased Lead The Good Life in January for £0.75m cash and £4.25m equity. It said the business integration is going to plan. It said it is also continuing its strategy of specialising in niche categories with Animal Bargains starting to trade in July to develop a pet specialist business.
Paul Wright, chairman, said:”The board is pleased with an excellent set of results. We continue to make strategic progress with sales growth in our niche product categories and with internet sales.
“The operational gearing of our TV business is reducing as sales growth accelerates and we are optimistic for the second half year. Trading in the first eight weeks of the second half of the year has continued positively and is in line with management expectations.”