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Mitre 10 revenue climbs above $500 mln for first time in three years

Wednesday 14th December 2011

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Mitre 10 (New Zealand), the country’s biggest hardware store chain, said annual sales rose above $500 million for the first time in three years amid a protracted downturn in the construction sector.

Revenue for the New Zealand-owned cooperative rose to $504.6 million in the 12 months ended June 30, from $494.3 million a year earlier, and the first time it cracked half a billion since 2008, according to the company’s annual report. Gross profit dipped to $32.3 million from $32.5 million a year earlier, while net profit almost doubled to $1.3 million.

Pre-tax earnings sank 48 percent to $2.2 million on rising lease costs and increased wage bills. The annual report was lodged with the Companies Office yesterday.

Mitre 10’s members received $42.7 million in purchase rebates and discounts, compared to $41 million in 2010. No distribution was made for ordinary shares, though redeemable preference shares, replacement retained patronage shares and retained patronage shares were paid a dividend of $7.50 per share, while preference class A shares and patronage class A shares received $5.50 apiece.

“Although the group had a positive result this year, retained earnings are not yet back at 2005 year levels, therefore no additional distribution will be paid to members with regard to the 2011 year group surplus,” chairman Martin Dippie said in his report.

In recent years, Mitre 10’s performance has been hurt by the country’s economic downturn, which sapped demand for new home building and renovations. At the same time, rival Bunnings has made inroads into the market. That’s against a backdrop where consumer spending on hardware, building and garden supplies shrank in the in the first nine months of this calendar year, according to government figures.

The annual report’s commentary was thinner than usual and didn’t include an outlook statement from chief executive John Hartmann, who joined the team in March last year, having previously worked as a senior executive at US hardware chain Home Depot.

The retailer plans to open six new Mega stores in the 2012 financial year with a further eight the following year, the NZ Herald newspaper reported in October.


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