Healthy-eating chain Tossed has seen strong like-for-like (lfl) sales growth for the year to date, following a tough trading period in the financial year ended 31 March 2018.

The business, which acquired the Vital Ingredient business and its thirteen stores in March last year, has seen “healthy double-digit like-for-like growth”, in its 2018/19 financial year so far, Tossed’s finance director Neil Sebba told MCA.

As noted in its latest accounts filed at Companies House last week, Tossed’s lfls fell into decline from the end of summer 2017, and remained negative until the end of the financial year. Coupled with the net closure of one store it resulted in group turnover falling 6.8% to £9.4m, with normalised EBITDA at -£107k, compared with +£389k the previous year.

The company said the market landscape in which it operates is currently subject to a combination of legislative pressures on wages and rating reforms, “and an increasing scarcity of the high-quality raw materials that we source for our menu”. However, it said that these pressures had been mitigated to some extent due to the economies of scale achieved after the consolidation of Vital Ingredient into the purchasing structure.

Since the year-end sales have picked up, and combined with the stores acquired from Vital Ingredient, Tossed said it expects to report “a materially increased turnover figure” at the end of the next financial year. The report added that it would “return to the expansion trail following the Vital Ingredient integration”.

“Like-for-likes in the underlying estate have been very strong, particularly in recent months, supported by our hot food offer,” Sebba told MCA.

He said that the acquisition of Vital Ingredient meant that Tossed was now “of a different scale”; however, Vital’s property portfolio has been streamlined, “with 10 of the acquired estate remaining”. “We’re looking forward to seeing what the combined business can do in 2019,” he added.

The Holborn Viaduct and King William Street Vital Ingredients sites were closed because they were over the road from existing Tossed sites, but ”unfortunately Petty France was closed because we couldn’t secure it on viable terms”, explained Sebba.

Further shareholder funding of £0.7m was extended to the group during the period, which was converted into equity in March 2018. Tossed said that while trading performance had meant that covenants were not met at year-end, the business continued to be supported by a debt package from Santander.