Bike retail chain Evans Cycles has recorded a pre-tax profit slide of 69.4% for the year ending October 31st, 2015, dropping down to £1.36 million.
“Soft demand” for cycling, poor weather and a strong prior year were cited in the financial statement for the year-on-year gap. The financial statement confirms that earlier this year Evans’ parent ECI were in talks with lenders to overhaul its financing deals, effective as of July 28th.
As a result, ECI has invested additional funds into Evans to reduce term loans with banks and provide added liquidity.
Despite opening seven new branches in the period, resulting in turnover growth of 4.5%, the retail chain’s EBITDA, considered a KPI by the board, is now worth £4.8 million, a 36% drop YOY.
The new branches opened in Norwich, Dulwich, London King’s Cross, Leicester, Chester, Cambridge and Macclesfield. Meanwhile, the Crawley branch closed at the end of its lease, bringing the chain to a total of 58 stores.
In its financial statement, Evans states that its main risks going forward tie in with the wider economic climate and strength of the market as a whole. The director’s suggest that the retailer can weather the storm relatively risk free. The directors note that UK adult cycling levels in the UK still sit substantially below those levels on mainland Europe, especially in cities and believe there to be an opportunity for growth.