The Entertainer made £1 million profit in the year to January 29th, compared to £1.4 million in the previous year.
Although profits were down sales increased 8.4 per cent to £71 million.
The Entertainer MD Gary Grant said that the firm had "actually budgeted to make £750,000 profit."
He said: "We relocated our warehouse in the year from Amersham to Swindon. It's three times bigger to accommodate 100 stores."
The independent retail chain opened its 60th store this week and will add six more before the end of the year.
Capitalising on the reduced cost of property, the chain will have opened 12 new shops in 2011.