Marks Electrical Group PLC on Thursday said profit decreased significantly despite revenue growth in its first half, but said it remains well-positioned for the Christmas period.

Shares in Marks Electrical were down 3.2% at 91.00 pence on Thursday afternoon in London.

The Leicester-based electrical products retailer said pretax profit for the six months ended September 30 was £1.2 million, down 45% from £2.1 million the previous year.

Marks Electrical also declared an 0.30 pence per share interim dividend, unchanged from the previous year.

Revenue increased 25% to £53.9 million from £43.1 million, marking what Chief Executive Officer Mark Smithson called ‘a strong start to the year’.

Adjusted earnings before interest, tax, depreciation and amortisation decreased 14% to £2.3 million from £2.7 million, while statutory earnings per share decreased to 0.83 pence from 1.66p.

Marks Electrical said the cost of sales increased 25% to £40.5 million from £32.3 million. Total administrative expenses increased 31% to £7.6 million from £5.8 million, while distribution costs rose 61% to £4.9 million from £3.0 million.

CEO Smithson said the company ‘continued to remain disciplined on marketing costs, maintained our focus on overhead cost control and are continuing to gain market share profitably, a key differentiator of our growth strategy’.

Since the end of the half year, Marks Electrical said double-digit revenue growth continued in October and preceded a ‘strong start’ to November. It said this leaves it well-positioned for the ‘peak’ Christmas period.

‘As momentum builds going into the peak trading period,’ said Smithson, ‘our focus on operational excellence and customer service, combined with our strong net cash position, provides us with a robust platform to improve profitability in the second half and achieve our full year targets.’

Copyright 2023 Alliance News Ltd. All Rights Reserved.