Newly filed accounts for The Original Factory Shop (TOFS) show the discount retailer has made a pre-tax profit for the first time since 2019 after a big jump in sales.
The company recorded a pre-tax profit of £6.6m during the year to 27 March 2022, up from a loss of £2.9m in the previous 12 months.
Turnover rose from £92m to £124.4m, driven by its turnaround plan and new store openings.
A statement from the board said: “Over the past two years The Original Factory Shop has, like all business, had to adapt to a rapidly changing world.
“The early part of the year continued to be affected by the ongoing uncertainty and impact of the pandemic. As the year progressed, we saw the impact of rising inflation on product cost prices and consumer spending.
“The strength and resilience of the business model enabled us to continue to serve the needs of our local communities.”
Earlier this year, it was reported that TOFS had received several takeover approaches, with private equity firm Duke Street, which has controlled the 180-strong chain since 2007, instructing advisers at Deloitte to field interest in a deal.
The company had not been planning to run a formal sale process until next year. However, sources told Sky News in June that a sale prior to that point was now a possibility after a number of industry players expressed an interest in the business.
TOFS closed around 30 underperforming stores in 2018 through a Company Voluntary Arrangement (CVA) restructuring process. The deal also cleared the way for rent cuts as Duke Street sought to put the business on a more sustainable financial footing.
Last September, TOFS began rolling out concessions in Co-op food stores. They offer a range of clothing, pet, electrical, and homewares products, as well as a party shop and click & collect service.
The retailer also announced in 2021 that it planned to open 50 new stores during the next three years.
