dreamsSolihullextCoBeds specialist Dreams has posted sales of £193.6m in the year to 24th December in accounts that confirm its strong profits turnaround.

The national retailer—owned by funds advised by Sun Capital Partners since the spring of 2013—grew its top line despite net store closures, with like-for-like sales rising 6 per cent.

Gross margin was up by 190 basis points to 62.9 per cent.

Underlying EBITDA—as has been widely reported this year—turned around strongly, with the Buckinghamshire based business making £6.9m, compared to a £3.8m loss for the truncated period to 24th December 2013.

At the operating line, Dreams made £415,000 (2013:£9.7m loss) with the company recording a £6.4m deficit (2013: £14.8m) at the pre-tax line.

Its pre-tax figures are inclusive of debt interest, which totalled £6.8m in the latest period, all bar £60,000 of which was non-cash interest on its zero coupon bond owed to its parent company.

Cash generation during the year was strong, bringing in a net £9.8m from operations, having used £9.1m in operating activities the prior period.

This enabled a £7.5m net capex investment and the decision to repay £10.5m of principal and interest on its zero coupon bond. Year-end cash totalled £3.6m (2013: £5.7m) with net debt reaching £57.6m (2013: £52.5m) at the 24th December balance sheet date, the vast majority of which is intra-group debt owed to its parent company.

* all figures from consolidated group accounts of Dreams Topco Ltd

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