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The Warehouse Group Limited (NZX: WHS) FY22 First Quarter Sales Update

Friday 12th November 2021

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The Warehouse Group sees strong online growth despite ongoing COVID disruption to sales

The Warehouse Group (“the Group”) today reported retail sales for the first quarter ending 31 October 2021 of $630.7 million, a decline of 14.6% on the same quarter in FY21 and a decline of 9.2% on the same quarter in FY20. Gross profit margin reduced 200 basis points to 32.9% for the first quarter compared to the same quarter in FY21, largely due to increased clearance sales as we had a build-up of winter seasonal stock due to the COVID-19 lockdown timing. There has also been a change in product mix with the limitations of lockdown shopping.

Group CEO Nick Grayston says “The ongoing disruption of COVID-19 and in particular the 10.5-week lockdown in Auckland during the quarter has impacted our sales but trading is in line with our previous lockdown experiences.

“During lockdown, we have seen strong online momentum across the Group with our customers moving swiftly to our digital channels to purchase the items they need to work from home, do remote schooling and manage from their homes.

“With the opening of our retail stores across Auckland as part of the Level 3, Step 2 change from Wednesday 10 November, we are thrilled to welcome our customers back in store and anticipate significantly improved sales momentum. We are optimistic that pent up customer demand will see good uplift in our November and December trading performance and 18 The Warehouse stores in Auckland will be operating extended trading hours to help us meet this,” said Mr Grayston.

“We have a strong stock position across all brands and are well placed and ready to meet peak period Christmas and summer demand. We have had some concern about the growing domestic online delivery challenges and getting customers purchases out to them as we approach Christmas, as a result of the highly congested postal and courier networks. The opening of Auckland stores will relieve this pressure and will allow us to improve our online delivery promise to our customers who wish to shop remotely.”

Total Group online sales were $190.0 million for the quarter – representing growth of 118.2% compared to the same quarter last year and making up 30.1% of total Group sales (up from 11.8% in the same quarter last year and 11.5% for FY21). Total click and collect sales increased 117.7% in the quarter, making up 46.7% of total online sales.

Dividend update

At the time of the FY21 Annual Results, the final dividend was declared on the assumption that New Zealand would predominately be at Level 2 at the end of October. The Group has retained a strong liquidity position with core bank facilities of $330m undrawn and now with the move to Level 3 Step 2 in Auckland, the Board can confirm the final dividend of 17.5 cents remains as declared.

The record date for the dividend is 18 November and will be paid on 3 December 2021. This brings the total dividends for the year to 35.5 cents per share declared, and a pay-out ratio of 70.2% of adjusted net profit. This is in line with our recently amended dividend policy which was approved by the Board in March 2021 – to distribute at least 70% of the Group’s full year adjusted net profit.

2021 Annual Shareholder Meeting

The 2021 Annual Shareholder Meeting will take place on Friday 26 November 2021 as 10am.

Due to the ongoing uncertainty arising from the Covid-19 pandemic, the Annual Shareholders’ Meeting will be online only. Shareholders will be able to watch the meeting, vote and ask questions online through the Computershare Meeting Platform. To join the meeting, please go to click ‘Go’ on The Warehouse Group Limited meeting tile and then click ‘join meeting now’.

Please see the links below for details

The Warehouse Group FY22 Q1 Sales Update

The Warehouse Group Quarterly Sales Update

Source: The Warehouse Group Limited

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