The specialist arts & crafts retailer Hobbycraft has posted pre-tax profit growth of nearly 9%, though acknowledges challenges ahead.

Hobbycraft has announced its intention to open three new stores and create around 40 new jobs following a very strong performance for the 2022 financial year.

The company has posted adjusted pre-tax profit of £15m, representing +8.7% growth on the 2021 financial year, while revenue increased to £203.1m from £176.9m, growth of +14.8%.

Hobbycraft’s chief executive, Dominic Jordan, says that while the company is in a strong position heading into the 2023 financial year, the months ahead remain challenging.

He said: “As we emerge from the pandemic the business is incredibly well placed to build on the excellent performance in full-year 2022, with multiple new initiatives including the new website, workshop channel, further new stores and a subscription model which launches in the coming year.

“However, we are conscious that the year ahead will be challenging, particularly given the significant inflationary pressures on our customers and we are starting to see this impact on market demand in the early part of full-year 2023.”

Dominic went on to add that the current cost of living crisis is causing problems, and that the company also faced challenges with shipping costs. To mitigate this, the retailer focused instead on its eCommerce efforts, resulting in an uplift of +58.2% in online sales. Its benefits scheme, meanwhile, now has 5.9m Hobbycraft Club members.

The three new stores, located in Bromborough (Merseyside), Biggleswade (Bedfordshire) and Southend (Essex) join the seven opened during the 2021-22 financial year, which created 100 new jobs.