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Briscoe Group reports 3% lift in FY net profit

Tuesday 12th March 2019

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Retailer Briscoe Group reported a 3.4 percent lift in full year net profit despite what it said was "erratic consumer confidence." 

Briscoe Group, which owns the Briscoe's homewares and Rebel Sport chains and a minority stake in outdoor chain Kathmandu, said net profit for the year ended Jan. 27 was $63.4 million versus $61.3 million in the prior year. 

“We are pleased to announce another record profit for Briscoe Group in a challenging retail market which continues to contend with erratic consumer confidence and economic indicators making customers even more determined than ever to seek true value for money," said group managing director Rod Duke. 

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.  The latest ANZ Roy Morgan consumer confidence index showed a net 14 percent of the 1,001 respondents said they are better off financially now, compared to 12 percent in January.

Sales revenue lifted 4.4 percent to $631.9 million while same-store sales growth was up 3.7 percent.

"Economic uncertainty had certainly tested consumer confidence; increased wage pressures, erratic fuel prices and a challenging New Zealand dollar, all factors which have and will continue to impact retailers’ ability to maintain margins," he added. 

Gross margin increased from 39.97 percent to 40.09 percent due to improvements in stock-loss measurements from improved loss prevention initiatives as well as targeted operational and buying strategies, it said. 

Inventories totalled $81.02 million at year-end, $6.53 million higher than the $74.49 million reported for last year, reflecting the impact of the two additional Rebel Sport stores opened during the year, the increased demand for online shopping as well as a higher mix of imported inventory this year compared to last year’s year-end position, it said. 

He noted the online business showed strong sales growth, up 27 percent on the prior year. 

The result includes dividends of $6.4 million from its 18.9 percent shareholding in Kathmandu. 

It will pay a final dividend of 12 cents a share, bringing the dividend for the year to 20 cents a share versus 19 cents in the prior year. 

The stock was up 0.3 percent at $3.39. 

(BusinessDesk)

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