BEALES has revealed a £3million loss – but said one-off costs disguised the “big achievement” of keeping its sales figures steady.

The Bournemouth-based department store chain reported that sales and gross profit were broadly flat in the financial year to March 31, 2019.

But its bottom line was hit by exceptional and one-off costs totalling £915,000, including the bill for a management buyout which put the company in the ownership of its chief executive, Tony Brown.

Mr Brown told the Daily Echo: “The key thing for us is that, despite the exceptionally challenging environment we’re in, our gross profit is flat on the year, which is a pretty big achievement in this environment.”

He added: “Nationally, you’ve had Debenhams going into administration, you’ve had House of Fraser in administration and M&S closing hundreds of stores.”

Another fashion chain, Monsoon, had sought a company voluntary arrangement (CVA) to cut its rents, he said. “You’ve had a plethora of small brands going bust,” he added.

The post-tax loss of £3.05m compared with a £1.26m loss in the previous year.

But turnover was barely down at £48.3m compared with £48.7m, while gross profit was level year-on-year at £25m.

The rise in the national living wage and pension contributions cost Beales an extra £352,000 last year, the accounts show.

Mr Brown, who has presided over a series of eye-catching sales events at the company’s 21 stores, said the chain had seen “high double digit growth” in small appliances and homeware.

Menswear saw “moderate growth” but the whole industry was hit by a fall in sales of women’s fashions.

Mr Brown said weaker consumer confidence was hitting spending, as was a move towards more sustainable fashions.

Customers increasingly wanted better fabrics that lasted longer. “It’s the ‘wear 30 times’ product rather than wear three times,” Mr Brown added.

He said Bournemouth – where the business started in 1881 – was “still my most challenging town by a long way”.

But he expects a boost from the Bournemouth store’s new Christmas department, which has taken over the area previously used by its basement cafe.

“We think we’ve put together the best Christmas store – certainly in Bournemouth and probably of any town that we trade in,” he said.

During the year, Beales made significant investment in IT, which was delivered on time and on budget, said Mr Brown. It had invested in stores and in a new payroll system.

It turned its Hexham store into an outlet centre selling specially acquired stock and was trying a smaller store format in Worthing.

“The initial numbers are quite encouraging but you never know,” Mr Brown said of the Hexham store. “You’ve got to wait at least two months to see how it looks.”

The company employed an average of 1,148 people, compared with 1,095 the previous year, taking its staff costs to £15m. As the highest paid director, Mr Brown earned £195,917.