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Postie Plus 1H loss widens to $775k

Tuesday 27th March 2012

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Postie Plus, the clothing retailer that counts Jan Cameron as its biggest shareholder, widened its first-half loss on dwindling sales, while saying it is confidence it can claw back to profitability through the winter season.

The Christchurch-based company made a loss of $775,000 in the six months ended Jan. 29, compared to a loss of $749,000 a year earlier, it said in a statement. Sales fell 4.6 percent to $53.9 million, and it made an operating loss of $686,000.

Its inventories were $26.6 million as at Jan. 29 compared to $27.6 million in 2011.

“Whilst we are dissatisfied with a first-half loss, we recognise the importance of clearing our winter seasonal apparel each spring,” chief executive Ron Boskell said. “This is usually followed by profitable trading in the second half year.”

The retailer flagged a wider loss earlier this month, blaming the cost to close of poorly performing outlets for the decline. Its gross margin widened to 53.1 percent from 51.8 percent a year earlier.  The board didn’t declare an interim dividend.

The shares fell 3.8 percent to 25 cents in trading yesterday, valuing the retailer at $10 million.

Chairman Richard Punter said the company will be “striving to extract the higher volume and value of sales” in the second half of the year.

“The group has made a good early start to the new season,” Punter said.

Last year Postie Plus said it was keen to make some acquisitions in a bid to double its market share and would look to add at least one new brand by the end of this year. It cited its favourable debt ratio and strong balance sheet as reasons for the growth aspirations.

The retailer’s borrowings were $8.6 million as at Jan. 29, down from $14.6 million a year earlier.


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