Findel (LON:FDL), the home shopping and educational supplies business, this morning reported a 32.5% wider pre-tax loss of £76.1m for the full year to April as the group continued to wrestle with the fallout of significant accounting misstatements in its Educational Supplies division. Under the stewardship of newly-appointed chairman, David Sugden and chief executive, Phil Maudsley, a Full Potential Review is underway at the group in order to fix past problems. Overall, sales from continuing operations were down 4% at £547.0m, which Sugden said was a “creditable performance” given the difficult economic conditions.

Commenting on the results, Mr Sugden said: “The past year was undoubtedly a challenging period for the group. Since being appointed chairman, we have instigated a Full Potential Review of all the group's continuing operations, with the intention to complete this review as quickly as possible so we can return the group to profit growth. I am encouraged by the strength of the group's continuing businesses and we have a portfolio including profitable, cash generative businesses with significant potential for improved performance. As this year progresses, we will implement the actions identified within the Full Potential Review to achieve an improvement in group performance.”

Findel is a multi channel retailer operating across the business-to-consumer and business-to-business marketplaces. Its Home Shopping division is one of the largest direct mail companies in the UK, with brands including Express Gifts and Kleeneze. Its educational Supplies business is one of the largest independent suppliers of resources to schools and other educational establishments in the UK. Concerns over accounting misstatements came to light in the Educational Supplies business during March. The net impact on the company's results for the year ended April 3, 2009 was that benchmark and statutory profit before tax and net assets were overstated by £6.4m and £20.6m respectively. The board subsequently brought in advisers from KPMG to review the accounts of all material businesses within the group, which confirmed that the issues were isolated to the Education Supplies business.

In today’s update, the company said that current trading remained challenging but there was potential to improve performance through its portfolio of profitable and cash generative businesses. Shares in Findel slumped by 23.8% to 12.75p.

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