Tuesday 1st November 2011
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A ‘sensational’ performance from the Rebel Sports stores as a result of the Rugby World Cup helped lift Briscoe Group's third quarter sales 9.2%.
The company also expects to better last year's annual profit.
Sales for the 13 weeks ended October 30 rose to $98 million compared with $89.8 million in the same quarter last year. The previous third quarter's sales were up 6.2% on the same quarter of 2009.
Same-store sales – sales through stores open a year or more – were up an even stronger 13.6% – the company closed nine Living & Giving stores in the last 12 months and its Briscoes Homeware store in Salisbury Street in Christchurch has been demolished following the February 22 earthquake.
Total store numbers fell from 81 to 80 during the latest three months because the Napier Living & Giving store was closed when its lease expired.
The Homeware stores' same-store sales rose 8.2% while those of Rebel Sports soared 24.6%. Managing director Rod Duke said the latter had enjoyed “a sensational third quarter” as a result of the RWC.
Rebel Sport undoubtedly gained public support after Duke very publicly criticised All Blacks jersey manufacturer Adidas over the very high $220 recommended retail price tag on the jerseys and discounted them to $170.
“While obviously thrilled with the growth achieved from sporting goods, we are also pleased with the strong same-store sales growth returned by the homeware segment,” Duke said.
“The homeware market remains intensely competitive so to deliver same-store sales of 8.2% in a quarter where consumer focus and spending was acutely diverted towards All Blacks and rugby-related merchandise is especially pleasing,” he said.
The company's gross margin percentage suffered in the quarter but the increased sales volume “was sufficient to grow the bottom line in comparison to last year's third quarter.”
Duke said he remains “cautiously optimistic” heading into the company's crucial fourth quarter which includes Christmas.
“Traditionally, consumer spending tends to flatten in the run-up to an election and the economic news from Europe and America continues to dampen markets,” he said.
“However, we are certainly encouraged by our performance to date and are confident that the group's full-year tax-paid profit will exceed last year's (normalised) result of $24.1 million.” The previous year's result was $21.6 million but included a one-off $2.5 million tax adjustment.
“The extent to which we exceed this will, of course, be heavily influenced by the strength or otherwise of the retail market over the Christmas period.”
Briscoe shares closed yesterday at $1.40, near the middle of their tight $1.30 to $1.52 trading range over the last 12 months.
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