B&M European Value Retail SA (LSE:BME) reported a drop in annual profit despite a jump in revenue as margins were squeezed by the impact of rising costs.
In the 52 weeks to 25 March 2023, group revenues totalled £4.98bn, up 6.6% from £4.67bn the year prior, but statutory pre-tax profit fell to £436mln from £525mln with statutory diluted earnings per share of 34.7p, down from 42.1p.
The retailer said it had weathered the major economic headwinds and cost pressures "well", delivering strong sales growth and market share gains.
Nonetheless, the results showed a fall in margins with adjusted EBITDA margin falling 174 basis points to 11.5% during the period from 13.2% before.
B&M said UK fascia revenue increased by 4.0% year-on-year, driven by one-year like-for-like (LFL) revenue increase of 0.7% and the increase in space through new store openings.
Sales in France increased by 22.1%, while sales in Heron Foods increased by 18.1%.
The company said in the first nine weeks of the new financial year, B&M UK LFL sales have run at 8.3%, France and Heron have continued their trading momentum and it expects full-year adjusted EBITDA to be higher year-on-year.
Alejandro Russo, chief executive, said: “We expect to grow sales and profits in FY24, despite economic uncertainty."