Department stores group James Beattie today said it was reviewing all aspects of its business after annual profits fell 23%.

The Wolverhampton-based retailer said tight cost controls imposed last year would continue as it battles falling product prices and a significant rise in competition.

Pre-tax profits fell to £5.6 million in the 12 months to January 31 from £7.3 million a year ago - despite positive contributions from newly opened stores in Huddersfield and Telford.

The biggest problem has been the slump in sales at its Birmingham store following the opening of the new Bullring shopping centre in the city last year, the group said.

Sales at the store fell 10% during the 12 months, contributing to group turnover remaining flat at £96.1 million. Despite a 5% reduction in costs, trading losses at the store widened to £1.6 million in 2003 from £1.5 million.

However, the company said the impact of the Bullring in making Birmingham a destination for shoppers could bring benefits in the coming year.

Chairman Chris Jones said: "The overall trading climate continues to be hostile, competition intense and the effects of price deflation mean that profitable revenue growth is difficult to achieve."

Shareholders will receive an unchanged full-year dividend of 11.9p.

Wednesday April 07, 2004