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Briscoe says full-year profit almost doubled after strong Christmas; shares jump

Friday 5th February 2010

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Briscoe Group Ltd., the retailer controlled by managing director Rod Duke, said full-year profit almost doubled, restoring earnings to levels last seen in 2008, after strong Christmas trading fattened its margins.

Net income exceeded $20 million in the 12 months ended Jan. 31, from $11.6 million in 2009, the company said in a statement today. Last year’s earnings were about half those of 2008, when it earned $22.4 million. Shares of Briscoe jumped 7.1% to $1.35.

Briscoe released the profit figures with its fourth-quarter sales and is scheduled to release its final audited results on March 9. Sales rose 14% in the three months through Jan. 31 to $147 million. On a same-store basis and adjusting for an extra week in the latest period, sales climbed 8.5%.

The operator of the Briscoes Homeware, Living & Giving and Rebel Sport chains “achieved significant margin and profit improvements, continuing the trend established in every previous quarter of this financial year,” Duke said.

Briscoe responded to the worst economic downturn since 1991 by slashing costs and overhauling inventory as sales growth slowed.

In the fourth quarter, homeware store sales rose 16% to $102 million and revenue from sport goods gained 11% to $45 million.

Duke said the performance of the company’s Living & Giving stores was “less than satisfactory,” having been hurt by the economic downturn.

The retailer took an impairment charge of $827,000 in the first have and Duke said it is likely to take a further $1 million charge in second half.

The shares are rated 'outperform' based on the consensus of four analyst recommendations compiled by Reuters.

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