Very Group has reported a pre-tax profit drop of 92 per cent in its 2023 financial year ended 1 July.

Profits before tax over the 12-month period stood at £4.6 million compared with £63.9 million in the previous year.

The company said the result had been driven by heightened interest costs as a result of the “impact of the Bank of England’s base rate and, to a lesser extent, changes at EBITDA level.”

The company went on to say it would manage the cost of interest by “continuing to focus on investment-led growth, effective working capital management, and considered cost reduction.”

Overall group revenue remained relatively flat compared to 2022 at around £2.15 billion.

Group chief executive Lionel Desclee said the results came within a “challenging market” and reflected a “robust performance.”

“We recorded Group revenue of £2.147 million [compared to £2.148 in 2022], a decrease of 0.1 per cent year-on-year,” he said. “Underpinning this is Very UK, which grew at 1.9 per cent to £1.824.1 million [compared to £1.790 million in 2022]."

Desclee added that gross margin declined 0.8 per cent to 35.4 per cent which was driven by retail gross margin as the company made “strategic investments in pricing and product assortment.”

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