Winter flooding hits the financial performance at Angling Direct

The company has announced a pre-close trading update ahead of the publication of its financial results for the 12 months ended January 31 2020.

The company expects to report revenue for the financial period of £53.1 million, an increase of 26.5% compared with the same period the previous year.

The company said that it continued to grow sales both in-store and online.

Angling Direct recently opened new stores in Barnsley and Rotherham as it expands across the country.

The trading update added: "In-store sales were £27.9 million, an increase of 41.3% on the prior year period and up 12.0% on a like-for-like basis. Angling Direct added 10 new stores during the period, including two acquisitions, taking the total number of stores to 34.

"The company is pleased with the performance of the new stores, although the legacy stock that came with the acquired stores did contribute to margins being lower than the levels to which the board aspires. This stock has been mainly cleared and other actions have been taken to ensure that the company returns to expected margin levels in the new financial year and beyond."

Online sales grew to £25.2 million, an increase of 13.3% on the prior year period, through continued development of the company's e-commerce platform, the statement said.

The statement added: "In recent months, the company has focused on international territories that deliver both strong sales growth and the necessary level of profitability.

"Angling Direct's German, French and Netherlands websites, which make up the group's core European markets, increased sales by 24.6%, 70.9% and 86.7% respectively, with these three territories now representing 42% of total international sales.

"Total international sales increased by 7.6% to £5.0 million, accounting for 19.9% of total online sales during the year."

However, the statement added: "Notwithstanding the strong growth the company has delivered this year, a disappointing trading period, post-Christmas, influenced by exceptional winter flooding, has impacted profits.

"The lower levels of fishing activity meant that the higher margin, consumable products, were hit disproportionally. In addition, a more prudent approach has been taken to some legacy costs, which, taken together, lead the company to believe that it will deliver a pre-IFRS 16, EBITDA loss of no more than £0.5 million.

"The company continues to have a strong balance sheet and held cash of £5.9 million at the 31 January 2020."

Angling Direct opened its first store of the January 2021 financial year in Warrington on February 13 and the company said it was pleased to note that this resulted in a record sales and attendance for a store opening day.