Re-investment in its garden centres is paying off for the family-owned Notcutts group.

Chairman Nicky Dulieu 9below), announcing a 6.3% increase in sales and 20% rise in operating profits for the year to February 2016, expressed satisfaction with the group’s refurbishment strategy.

Capital expenditure of £10m in the past two years includes the recent refurbishment of Woodford Park in Cheshire and Wheatcroft garden centre in Nottingham – part of the five-year plan to invest £45m into its 18 garden centres and drive sales to £100m-plus

“Our newly developed centres continue to prove really popular with our customers and this has reinforced our strategy to redevelop our garden centres over the next five years,” she said.

Sales reached £67.8m last year, but gross margin fell from 50% to 48%, reflecting a decision to drive sales volumes, improve cash margin and sell older stock through more quickly.

Operating profit increased from £1.08m £1.29m, but pre-tax profits halved to £3.1m from £6.8m, due to the sale of a subsidiary the previous year.

The sale of non-core assets in order to focus on developing the garden centres yielded an exceptional gain of £2.6m from the sale of a warehouse and farmland, following a gain of £4.6m for a similar sale the year before.

Notcutts employs the equivalent of 707 full time staff.