Regional retailer Uchumi Supermarkets has posted a 30.31 per cent increase in profit after tax despite a rise in operating costs.

The supermarket’s chain on Tuesday said that profit after tax for the full year rose to Ksh357.01 million ($4.1 million) as at June 2013 compared to Ksh273.97 million ($3.2 million) as at June 2012 despite a rise in costs, some of which were attributed to branch expansion.

The branch expansion, which saw the supermarket’s chain open new branches in Ongata Rongai in Nairobi, Natete in Kampala and the Eldoret Sugar Plaza however paid off as customer numbers rose 10 per cent to 24 million from 22 million.

“Between July 2013 and December 2013, we plan to open the Kisii Branch (already open), Mombasa Island, Juja, Maua and Kisumu branches to increase traffic and grow sales revenue to cushion against the decreased per capital consumption while positioning our retail networks competitively,” said Jonathan Ciano, chief executive officer, Uchumi Supermarkets in a statement that accompanied the results.

Despite the increase in the number of customers, sales revenues rose marginally, by only 3.23 per cent to Ksh14.36 billion ($167million) for the year ended June this year from Ksh13.91 billion ($165.2 million) for the year ended June last year reflecting the tough operating environments particularly in Kenya and Uganda.

Operating expenses on the other hand rose by 17.19 per cent to Ksh3.17 billion ($36.9 million) from Ksh2.71 billion ($32.1 million) reflecting the increased costs as a result of the branch expansion while cost of sales rose 17.18 per cent reflecting the increased cost of living in the region.

“The economic and social environments were negatively impacted by challenges like the Euro debt crisis, general elections (effect in Uganda and Kenya), freezing of public spending and effect of devolution in Kenya, high cost of living and borrowing affecting infrastructural development and customer propensity to spend among others,” said Mr Ciano in the statement.

Uchumi’s trade margins however rose to 19.26 per cent during the year ended June 2013 from 18 per cent for the year ended June 2012 while finance costs dropped by 35.96 per cent to Ksh16.06 million ($186,751) from Ksh25.08 million ($297,768), factors that helped improve the company’s profitability.

The supermarket’s chain closed at Ksh19.70 ($0.225) on Monday at the Nairobi Securities Exchange a 3.14 per cent gain from Ksh19.10 ($0.222), its closing price at the end of last year.