Improving economic indicators in New Zealand should help
underpin earnings growth for The Warehouse Group in the 2014
financial year, Forsyth Barr broker Suzanne Kinnaird said
The group's reported pre-abnormal profit of $73.7 million was
slightly below Forsyth Barr's expectations and at the lower
end of recent earnings guidance of $73 million to $76
The profit was up 13.1% on the previous corresponding
period's $65.2 million, helped by the acquisition of Noel
Leeming and Torpedo7 over the period, she said.
The Warehouse reported a final dividend of 5.5c per share,
taking the full-year dividend to 21cps, below Forsyth Barr's
The gross margin fell 1.7% to 34.2% in the period.
''No specific guidance or commentary was given. We expect
profit growth in 2014 to be helped by full-year contributions
from both Noel Leeming and Torpedo7 acquisitions. We are not
expecting to make material changes to our earnings or our
$3.45 share target price,'' Ms Kinnaird said.
Shares in the group rose 2.93% after the announcement to
The Warehouse group chief executive Mark Powell said the Red
Sheds result was a solid result with 10 quarters of positive
same store sales and the introduction of several leading
international technology and appliance brands. While the
operating profit was up 5.3% to $85.2 million, indicating
steps in the right direction, it was still early days.
''We will continue to invest in store refits and our people
Red Sheds sales for the full year were $1.6 billion, an
increase of 4.4%, or $67 million, on the pcp and up $128
million since 2011. Same store sales increased 2%. Warehouse
Stationery sales were $321.8 million, an increase of 12.2%
compared with last year. Same store sales were up 2.8%.
Operating profit was up 4.8% to $10.3 million.
Noel Leeming's results from continuing operations under The
Warehouse Group ownership were: sales of $390.7 million,
operating profit of $11 million and a same store sales growth
of 7%. The second half saw sales of $273.5 million and a same
store sales increase of 6.4%. Same store sales in the fourth
quarter were 6.8%.
Merging Bond and Bond and Noel Leeming went well and Noel
Leeming continued to perform ahead of expectations, Mr Powell