The Queensland floods and the cost of opening new stores has led retailer The Reject Shop to post a fall in annual profit.

The company’s fiscal 2013 net profit was $19.4 million, down 11 per cent on its $21.9 million profit in the previous year despite a rise in continuing operations sales revenue to $618 million.

Chris Bryce, MD, said the company had performed well in a tough retail environment.

“Despite poor consumer sentiment and retail sales trends we continue to trade well,” he said.

He said while costs incurred by the rollout of 41 new stores affected results, the expansion would ensure a more “robust” business in the future.

Another 40 are planned for 2014 – part of a long-term company strategy to have more than 80 additional stores in less than two years.

The expansion will also see 1000 new employees taken on. Queensland’s 2011 floods also dampened profits, with the company suffering a number of insured losses relating to its Ipswich Distribution Centre.

Sales were up 13.3 per cent on last year, on a 52-week 2012 basis, but up 11.3 on a 53-week 2012. The company will pay a final, fully-franked, dividend of 13 cents per share in October.

AAP