The owner of North East sports retailer Start Fitness has seen revenues and profits rocket despite being forced to close its stores during the Covid-19 lockdown.
W&M Holding Company, which trades as Start Fitness, is well known across the region for its sports gear, including its More Mile brand of running clothing and accessories. Since establishing in 1991, it now has several stores in Newcastle, Durham and Darlington.
Accounts for the Cramlington firm, covering the year ended July 31, detail the firm’s strong online presence, with its e-commerce division bringing in 75% of revenue.
The firm’s turnover rose 18% from £25.2m to £29.7m, while operating profit jumped 61.5% from £2.6m to £4.2m.
The accounts also showed the firm received job retention scheme grant funding of £63,311, and that employee numbers rose from 72 to 79.
In a report accompanying the accounts, director Tony Wallett said the company was in a strong position despite the enforced closures during lockdown.
He said the firm could remain profitable without its high street presence - although it added to its portfolio in August through the opening of new store People’s Price on Newcastle’s Northumberland, taking on neighbouring Primark by selling clothes at competitive prices.
In his report, Mr Wallett said: “The business has grown in recent years mainly due to increased reputation, brand awareness and a continued push to look for new lines and business opportunities.
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“The group finds itself in a strong financial position and is well placed to face the challenges ahead. Future plans include continued investment in the groups management and operating infrastructure.
“At the end of March, the group entered an unprecedented trading environment following the Covid-19 outbreak. With over 75% of sales driven through E-channels, the group continues to trade strongly in the current trading environment.
“Early November 2020 saw the country enter into yet another national lockdown. Lessons learned during the first lockdown leave the group in a very strong position to not only cope with the closure of the High Street retail units but to grow its online presence.”
The firm said it expected to see further restrictions next year – either a local or national basis – but that it should continue to grow it online presence, adding that a review of the business and stress testing had shown it could continue to be profitable and maintain positive cash flow, with or without a High Street presence.
On the firm’s investment in a new brand, the report said: “The group have found themselves in the healthy position to invest within the community are purchased a property after the year end in a prime Newcastle city centre location.
“People’s Price caters for the general population selling reduced price every day closing essentials. Opening just one month prior to the November lockdown, the shop has proven to be a success and is testament to the group vision and understanding shopping needs and habits.”
The report added that the firm is preparing for Brexit, however it pans out.
It added: “The nation still does not know if this will be a hard or soft Brexit, however the group have a team that are preparing for either scenario. What is certain it will be the reduction of opportunity within Europe; with the potential to affect the margin, however the group is excited about the prospect of looking for new opportunities.”