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Squires enjoys robust growth in latest financial results

Published: 29 January 2013
Garden centre chain Squires achieved substantial growth in the 12 months to July 31 2012, according to accounts filed at Companies House recently.
Squires enjoys robust growth in latest financial results
Sales jumped 10% to £36.6m, thanks to the integration of the three Shoots centres acquired during 2011. They contributed £5.9m of sales; like-for-like performance at the existing centres dropped by 6.8%, however.

Chairman Colin Squire reported that sales were up year-on-year until the end of March, but that the gains were wiped out by the appalling weather for the remainder of the main selling season.

The redeveloped Shepperton centre performed well, and cafes achieved sales of £5m for the first time. Gross profit did even better than sales, with a 12% rise to £18.2m. The translates into a gross margin of 49.7%, compared to 48.8% in the previous year - one of the highest gross margins achieved by any garden centre operator in the UK, according to DIY Week's latest analysis. Mr Squire attributed this to tight stock control on perishable seasonal lines, and better margins in the cafes.

Operating profit dropped by 13% to £2.8m, however, reflecting redevelopment costs and investment at head office, and net profit was down 19% at £2.3m. Despite this, the operating and net margins - 7.7% and 6.3% respectively - remain among the best in the industry.

Staff numbers rose substantially, up from 559 to 690, again as a result of the Shoots acquisition, and the salary bill rose 20% to £9.6m, or 26.2% of turnover. This shows that staff costs are rising steadily: the previous year's salary bill was 24.1% of turnover, and the year before it was 23%.

From the shareholder's point of view, Squires remains a very sound investment, with return on capital of just over 10%. Plans for the current year include a substantial refurbishment at Twickenham, and a major extension of the Woking centre.


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