Record Briscoe profit of $186m

Bulk store retailer Briscoe Group has reported a record profit for the year ended January 26 in what managing director Rod Duke described as a challenging market for many retailers.

Operating profit of $186.2 million was up 5.82% on the previous corresponding period. Earnings before interest and tax were up 10.38% at $45.2 million and reported profit was up 10.2% at $33.6 million.

Total sales were up 6.82% at $483.57 million and same-store sales were up 5.23%.

A final dividend of 8c per share, up 14.3%, took the total dividend of the year to 12.5cps, up 13.64% - excluding the special dividend paid in June 2012.

Mr Duke said the focus on managing and developing the group's retail brands had been significant in generating the result and underpinned the strong profit growth of recent years.

''This year's result represents an increase of 55% over our full-year profit result just three years ago for the year ended January 2011.''

The competitiveness of the market had necessitated more aggressive promotions, which had slightly eroded the gross margin percentage, he said.

But by continuing to improve the quality of products sold, and increasing the average sale and transaction numbers, the gross margin dollars increased nearly 6% over the previous full year.

The group's gross profit margin for the year fell from 38.86% to 38.5%, reflecting the ''extraordinarily challenging'' start to the year as a result of the late start to the winter category sales and the continued competitiveness of the market throughout the year.

The group also operates Rebel Sports and Living and Giving, in New Zealand.

On a same-store basis, the homeware and sporting goods segments returned sales increases of 4.6% and 6.57% respectively in the period.

During the year, $16.2 million of capital investment was made by the group, including for property purchases made in Invercargill and Petone, the fit-out of one new store, five store refurbishments and the completion of the store counter realignment project started last year.

Stock held at balance date totalled $69.3 million, $4.7 million higher than the pcp. Mr Duke said the higher stock reflected the additional Briscoes Homeware store opened in Kerikeri during the year, increased stock holdings to satisfy the increase in online sales and increased levels of product directly imported by the group.

Cash and bank balances at balance date were $7.22 million higher than the pcp at $84.8 million.

''We look forward to another year of improving and growing our business,'' Mr Duke said.

''While many commentators are talking up the outlook for the New Zealand economy, we see a number of retailers continuing to struggle to grow profitability. Our experience leads us to be cautiously optimistic about the year ahead for Briscoe Group.''


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