Insider Media Limited

Walsall-based retailer One Stop Stores has posted a £2m drop in profit in its latest year-end accounts. The dip to £21m came after the company embarked on a major expansion plan by opening 19 new outlets and investing £21m in a relaunch.

One Stop Stores, a subsidiary of supermarket giant Tesco, posted a £21.3m profit after tax for the year ending 26 February compared with £23.3m in 2010.

Revenues grew almost £21m over the year, rising to £551.1m from £529.6m.

One Stop Stores said the results showed "another profitable year of like-for-like growth".

Having opened 19 new outlets over the year, the chain now operates more than 500 stores across the UK.

It completed its relaunch programme within the estate, investing £21m in 28 stores. Smaller refits were also carried out across 43 outlets at a cost of £1m.

Looking ahead, the company said it planned to "increase the sales area, deliver efficiency savings and keep things simple for staff".

Over the 12-month period, £79m was spent on staff costs, an increase of almost £4m on its 2010 figures. The additional costings were required after the company launched a recruitment drive, hiring almost 300 new employees during the year.

Tesco told Insider it did not comment on its individual businesses' performances. However, it its latest accounts from August this year, the company said: "All our markets remain highly competitive and levels of consumer confidence are generally low.

"Having set up our businesses this year to deal with this kind of environment, we have coped well through a combination of investing to improve the shopping trip for customers, strong productivity and capturing more of the benefits of group skill and scale."

Over the year, One Stop Stores' trade creditor bills increased by more than £6m. Trade creditors were owed £54.6m at the end of February 20111, compared with £47.8m the year before.

After the year-end, One Stop undertook a part acquisition of Mills Group, with the purchase of 12 companies across 76 stores. After an investigation by the Office of Fair Trading, the buy was allowed to go ahead, and the purchase was completed on 20 March.