The Range’s plunged to a £11.7m loss as sales fell more than 10% in its last financial year.
Revenues still represented a 26% rise on its pre-pandemic levels, with a 17.3% jump in like-for-likes, in the year to January 2023.
Despite the profits drop, The Range said the year represented a return to a more stable period of trading, following heightened demand during the pandemic.
In its current year, sales are back in growth with like-for-like gross profit up over 4% and it expects profits to exceed pre-pandemic levels this year.
The Range CFO Jamie Messham said: “Sales vs pre-pandemic levels are very encouraging and reflective of a loyal and diverse customer base.”
“The business enters the last 3 months of the year, full of optimism and ready to deliver a strong Christmas offering in what is traditionally our busiest trading period of the year.”
However, Messham admitted that profitability in its last year was “disappointing” at the value retailer.
Gross profit margin dipped from 33% to 31.9% in its largely driven by higher costs of goods purchased and associated freight costs, as well as more aggressive price discounting in-store and online.
It said challenges it faced after the pandemic, such as the significant amount of excess stock it was carrying, which incurred ongoing rent and demurrage charges, had ceased, and that The Range had now entered “a phase of sustained growth”.
The business has now right sized its stock holding, reducing it by 25% over the year, which has allowed operational efficiencies to return.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
The Range chief executive Alex Simpkin said: “The FY 23 results are reflective of a period that ended 9 months ago and during which, significant operational challenges arose for many in the retail sector; primarily related to the fallout from Covid and the Ukrainian conflict.
“Since the period end, The Range has invested in constructing a new 1.2 million sq ft distribution centre in Stowmarket, with completion taking place on the 6th November 2023.
“This will provide the business with a best-in-class facility to service its distribution and capacity requirements and meet its ambitious expansion plans.”
It has now introduced Wilko products into The Range stores and revealed earlier this month that it would open three stand-alone Wilko stores ahead of Christmas.
Simpkin promised more Wilko store openings in 2024.
“This acquisition will further complement our existing multichannel offering as we strive to provide customers with high quality goods, at great value.”
The Range aims to open between 20 and 25 stores this year.
Simpkin added: “The group is in a strong position to deliver on its ambitious growth plans, and we head into our Christmas period with an exciting range that we know that our valued customers will love.”