The UK’s biggest off-licence group, Conviviality Retail, has said that the cost of listing itself on the stock market saw pre-tax profits plummet from £1.7 million to a £1.1 million loss in the six months to the end of October.

In a first half which the company described as a “period of considerable change for the business”, Conviviality saw average retail sales per store rise 4.9% year-on-year, with group profit before tax excluding exceptional items increasing by 13.6% to £2.2 million, boosted by a strong performance in its Wine Rack division.

Commenting on the results, Diana Hunter, CEO of Conviviality, said: “As anticipated store numbers and therefore revenues have reduced in the first half of this financial year, this reduction is in line with our expectations and is consistent with our aim of improving the quality of our store estate. Work is underway to build a strong pipeline of new stores in higher quality locations for both Bargain Booze and Wine Rack and convert this pipeline to drive sales growth in future years.
“We are making progress across all elements of our strategy and expect the benefit of these initiatives to start to drive growth from the next financial year 2014/15.

“Our focus over this Christmas trading period has been to drive profitable sales for our franchisees and Conviviality. Performance in the two weeks to 5th January delivered strong like for like retail sales growth of 2.8%. The average sales per store increased year on year by 5.7% an encouraging indicator of the improving quality of the store estate.

“Our customers recognise our fascias as the place to shop for an unrivalled choice of great value off-licence.

“On behalf of Conviviality and our franchisees we thank all of our customers for their continued loyalty. The dedication and commitment of our franchisees and employees and the support of our suppliers is crucial to our success and they have risen admirably to the challenge of Conviviality becoming a listed company. I thank them all for their efforts both pre and post IPO this year."