In the previous year Moss made a pre-tax profit of£5.1 million.
Like-for-like sales were flat for the year, but the menswear retailer said it had moved ahead in the first nine weeks of trading in the current year and was 0.9 per cent up on last year.
The retailer said the Moss Bros stores bore the brunt of the consumer fallout during the latter part of the year and recorded a 3.2 per cent fall in like-for-likes for the period.
Gross margin was up 50 basis points at the chain. Moss Bros will continue its strategy to reposition itself away from the value end of the market.
Moss Bros's fashion division posted a like-for-like rise of 3.8 per cent for the year, but gross margin fell 40 basis points. Moss said that the fashion arm was less affected by the wider economic implications.
Hugo Boss franchise stores' like-for-likes rose 6.4 per cent while Canali recorded a 5.6 per cent increase for the year.
Moss Bros will invest£1.8 million introducing a new hire supply chain infrastructure, which will be ready in early 2009.
The retailer said in a statement: “The results for the year are in line with expectations and reflect the effect of deteriorating retail markets, particularly in menswear and continuing increases in property and utility costs. Management has already taken action to react to the market conditions and prepare for what will be a challenging year. The internal structure within the business is being aligned to the ongoing economic climate whilst at the same time reducing the complexities and processes, which operate within the business.”
Moss Bros confirmed that it is in talks with Baugur, which made an indicative offer of 42p a share in February.
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