DISCOUNT retailer B&M has revealed plans to create 2,500 new jobs after hailing good momentum in sales and profits.

The chain, which was set up in 1978, has about 400 stores, and says it wants to eventually open 850 UK shops.

In its first set of results since joining the London stock market in the summer, revenues increased by 29.7 per cent to £739.8m in the six months to September 27, while on a like-for-like basis the UK sales figure rose 4.8 per cent.

Underlying earnings lifted 34 per cent to £73m, but higher costs linked to the flotation and a recent refinancing caused a bottom-line loss of £16.4m.

Former Tesco chief executive Sir Terry Leahy, who is the company's chairman, said there was scope for the business to at least double in size over the next few years.

The company, which has more than 16,000 staff, expects to complete the net addition of at least 50 shops in the financial year to the end of March.

It said the UK retail property market was "highly favourable" as national retailers look to "rightsize" their estates and the improved economic picture encourages letting opportunities with developers on newly constructed space.

B&M has also acquired an 80 per cent stake in Jawoll, a variety goods retailer based in north west Germany with 49 stores.

Simon Arora, chief executive, said: "The retail environment in both the UK and German markets remains highly competitive.

"However, our disruptive business model, and the value for money we offer our shoppers, gives the board confidence we can continue our successful track record of growth.

"The UK has the potential for approximately 850 B&M stores over the long-term and we remain very pleased with our new store opening programme."

Brothers Simon, Bobby and Robin Arora, who bought the chain in 2004, got another payday from the flotation, having already received an estimated £900m when they sold a controlling stake to private equity firm Clayton, Dubilier & Rice (CD&R) in December 2012.

Selling shareholders, including the Aroras and funds managed by CD&R, received about £1bn in the flotation, while the company itself received £75m.