Full year profits likely to be below expectations
Value convenience group Instore has seen its gross profit for the 26 weeks to August 26 reduced to£7.9 million, down from last year's£12 million. Sales over the period were up 6.4 per cent, rising to£128 million from last year's£120.3 million. Like-for-likes were up by 7.4 per cent. Instore warned that profit for the full year is likely to be below expectations.

In its interim results, the retail group, which owns the Poundstretcher and Instore fascias, detailed the cost of clearing old stock and reducing excess inventory as being responsible for the outcome. Increasing rental levels and hikes in utilities bills were also listed as contributing to the decline in profits.

Instore Trevor Coates chief executive and managing director said that, following his appointment in March, a root and branch review of the business had identified a future direction for the business and a return to profitability. He said that work to reduce stock levels and to rationalise product categories was under way, but that 'inevitably, these changes take time to implement'.

Trading at Instore for the first eight weeks of the second half is running 3.8 per cent ahead of last year like-for-like.