Discount retailer Matalan has reported first-half sales increases thanks to a revamp of its supply chain, although profits have fared less well.

The group, whose Lee Cooper jeans division has been at the centre of continuous takeover speculation, recorded sales growth of 13.6 per cent to £565.2 million for the first half ended in September, from £507.6m in the year-before period.

First-half profits dropped from £42.2m to £41.7m on a pre-tax basis, but increased 9 per cent to £46m at operating level

Same-store sales at the core Matalan chain grew 4.5 per cent in the six months to August 28.

Lee Cooper saw operating losses of £1.7m in the first half as its sales dropped just under 12 per cent to £26.6m.

The company has been undergoing store refurbishment and has also been setting up a new distribution centre.

Matalan said it is still in talks over a potential sale of Lee Cooper, which it put up for sale last month, and that it predicts it will fulfill full-year market expectations.
Chief executive John King said in a statement: "Our core retail chain has grown profits despite significant investment in our supply chain and our stores.

"Current trading is also encouraging, and we are in a solid position ahead of the important Christmas trading period".

The company claims to be the UK's market leader in men's wear, in terms of unit sales.

1985-established Matalan owns more than 160 stores, selling brand-name and private-label men's, ladies' and children's apparel at discounted prices.

Its brand-name merchandise includes Farah, Pepe, Playtex, Sloggi, Wilson, and Wrangler, whilst its its private labels include Lee Cooper, Wolsey, Easy, US athletic, Falmer, and jeffrey Rogers.