Warehouse results hit by fine weather

Better-than-expected weather hurt The Warehouse Group's sales in the three months ended May 2.

The company reported yesterday that third-quarter sales of $376 million were down 1.9% on the previous corresponding period (pcp).

The Red Sheds achieved third-quarter sales of $323.8 million, down 2.6% compared with the pcp, and year-to-date sales of $1.14 billion were down 1.8%.

On a like-for-like basis, adjusting for the timing effects of last year's 53rd trading week, third-quarter same-store sales were down 3.3%.

Group chief executive Ian Morrice said the sales shortfall compared with the third quarter last year was mostly because of a continued contraction in the music and DVD market and a very slow start to winter, with unseasonably warm weather affecting key categories such as winter apparel and heating.

April highlighted the market remained erratic, but Easter trading had been solid, and customers were responding well to growth initiatives in categories such as footwear, sporting goods and jewellery, he said.

Warehouse Stationery had third-quarter sales of $52.2 million, up 2.2% compared with the pcp.

Year-to-date sales of $148.4 million were up 6.3%.

On a like-for-like basis, after adjusting for the timing effects of last year's 53rd trading week, and the timing of "back to school", in particular, third-quarter same-store sales were up 11.2%.

"The Warehouse Stationery result ... further reinforced the company's view that the turnaround being achieved by the business is sustainable."

Subject to any adverse changes in expected conditions, the directors remained confident adjusted after-tax profit for the full year would be similar to that achieved in 2009, Mr Morrice said.

 

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