Higher costs dent Furniture Village earnings

FURNITURE Village has reported a 41 per cent slump in annual pre-tax profits, but said sales had remained solid despite a torrid UK retail environment.

The retailer’s turnover rose 4.8 per cent to £180.7m in the year to 3 April 2011, according to its Companies House filings.

The rise was partly down to three new store openings, and extra costs and marketing expenses pulled down its pre-tax bottom line from £3.6m to £2.1m for the year. The firm also blamed “a degree of challenge” in the UK retail market.

“The past year has been one in which we appear to have traded somewhat better than many of our competitors and yet we will not be lulled into a false sense of security,” the directors said in a statement.

The Slough-based firm said it had increased centralisation and worked on cutting costs, as well as hedging its US dollar exposure, to help protect the business from wider volatility.

The firm’s lease rentals rose from £14.5m to £15.6m in the period, partly as a result of opening new stores.

The highest-paid director, who was not named in the report, received £336,000, down slightly on the previous year.