Another record profit for Briscoes

Briscoes online sales rose 27% during the year and should receive a further boost when its revamped online platform is launched later in the year. Photo: Gerard O'Brien
Briscoes online sales rose 27% during the year and should receive a further boost when its revamped online platform is launched later in the year. Photo: Gerard O'Brien
Briscoes has delivered another record full-year profit - up 3.3% on a year ago at $63.3million, underpinned by a $6.5million Kathmandu dividend.

Briscoes managing director and majority shareholder Rod Duke said he was pleased with the profit, noting it was made against the backdrop of ''erratic consumer confidence'' and ''challenging retail market''.

''Economic uncertainty has certainly tested consumer confidence; increased wage pressures, erratic fuel prices and a challenging New Zealand dollar, all factors which will continue to impact retailers' ability to maintain margins,'' he said in the market release.

No guidance was given for the year ahead.

Total sales rose 4.43% to $631.9million for its year to the end of January, earnings before interest and tax rose 3.16% to $86million and after-tax profit was up 3.37% to $63.3million.

The after-tax profit includes a dividend of $6.4million from leisure and sport retailer Kathmandu, of which Briscoes still owns 18.9%. Briscoes was unsuccessful in a mid-2015 $362million takeover bid for Kathmandu.

A second-half dividend of 12c was declared, taking the full year to 20c, a 5.26% gain on a year ago. Briscoes shares rose 1c to $3.39 after the announcement, but were down 7.8% on a year ago.

Forsyth Barr broker Suzanne Kinnaird said the result was ''steady'' and in line with expectations, and the brokerage was not expecting to make material changes to its forecasts.

''Both the Homeware and Rebel divisions were solid, with store earnings before interest and tax up 1.2% at $46.7million and up 2.8% to $31.1 million [respectively],'' she said.

Craigs Investment Partners broker Peter McIntyre said the result was ''tidy'' and in line with expectations, especially with growth in sales, same-store data, gross profit margin and dividend.

''The development programme is progressing well, with new stores. They appear to be focusing on smaller centres now.''

He said without the $6.5million Kathmandu dividend the after-tax profit would have come in about 10% less.

Mrs Kinnaird said online sales were ''strong'', being up 27%, and should receive a further boost when a new online platform was launched later in the year.

Mr Duke said the stock inventory rose by $6.53million to $81million at year end, which reflected having two new Rebel Sports stores, a higher mix of imported goods and increased demand for online shopping.

''Our online business continues to produce excellent sales growth, finishing the year around 27% up,'' he said.

Consumer confidence fell to a six-year low in September last year, as households fretted about the outlook for their own finances, and has only gradually recovered, BusinessDesk reported.

The latest ANZ Roy Morgan consumer confidence index showed a net 14% of the 1001 respondents said they were better off financially now, compared to 12% in January.

Mrs Kinnaird said it was pleasing that Briscoes' gross margin dollar was up 4.7%, from the small lift in gross margin rising from 39.97% to 40.09%.

Mr Duke said: ''We'll continue to focus on our online offering while maintaining our proven strategy of adding stores to our network, as and when we identify suitable opportunities.''

Rebel Sports stores opened in Kerikeri and Christchurch last year, and a Northland Briscoes Homeware was relocated last November.

Add a Comment

 

Advertisement

postanote_header_620_x_80.png

postanote_620_x_25.jpg