Cosmetics chain Body Shop has shown signs of recovery following a major overhaul of the business.

The retailer reported a 76% jump in pre-tax profits to £20.4m, after one-off redundancy costs dropped sharply.

Operating profits edged up to £26.9m from £26.7m in 2002.

After being one of the icons of the 1980s High Street, Body Shop was forced into drastic action after rivals developed similar products and stole market share.

The company issued three profit warnings in the space of 18 months before its management was shaken up last year.

The changes saw the company's founder, Anita Roddick, step down from her position as co-chairman.

Sars threat

Chief executive Peter Saunders said he was "pleased" with the progress so far but added further efficiency improvements could still be made.

He also noted that the economic outlook remained weak with consumer confidence falling.

"Both the conflict in Iraq and the Sars outbreak are having a direct adverse impact in a number of markets," he said.

Worldwide sales at Body Shop grew by 2% to £697.1m, although on a like-for-like basis - which strips out the effects of new store openings - sales slipped 1%.

The big jump in pre-tax profits was mainly down to a big fall in exceptional items.

One-off costs fell to £5.4m, of which £4.7m related to redundancies, and these were partially offset by a £2.8m windfall from a VAT refund and insurance claims.

Exceptional costs - including write-downs, redundancies and other costs - had hit £11.5m in 2002.