Briscoe Group, the homeware and sporting goods retail chain, boosted first-half profit 24% as it improves the layout of its stores and benefits from a strong New Zealand dollar. The stock jumped to a record.
Profit rose to $18.5 million, or 8.37 cents a share, in the 26 weeks
to July 27, from $14.9 million, or 6.81 cents, in the year earlier
period, the Auckland-based company said in a statement. Profit rose 17%
excluding a $1.34 insurance payment related to the 2011 Christchurch
earthquake, Briscoe said. Sales rose 6.5% to $231.5 million.
The company, which operates 78 Briscoes Homeware, Rebel Sport and
Living & Giving stores, has changed the layout of many of its stores
to increase the available selling space and improve the flow of stock
through to the sales floor. Briscoe has benefited from a higher New
Zealand dollar lowering the cost of its imported products, allowing it
to lower its prices as well as increase its profit margins. Gross profit
margin rose to 39.6% in the latest half from 39.18% in the year earlier
"We are very pleased to finish this first half with strong growth
recorded in sales, gross profit and bottom line profit," said managing
director Rod Duke. "We are also optimistic about the operational and
financial outlook for the group."
Briscoe didn't provide a full-year earnings forecast. The company
increased its first half dividend to 5.5 cents a share from 4.5 cents in
the year earlier period. The dividend will be paid September 30.
Shares in Briscoe jumped 3.5% to a record $3, and have gained 21% this year.
Briscoe has increased its profits even as rivals including Warehouse
Group warned earnings would be dented by a warmer start to winter and as
retailers face increased rivalry from internet competitors.
The company said its online business continues to grow significantly
and it will invest in improving the functionality and performance of tis
ecommerce platform in the second half of the financial year.
In the first half, earnings before interest and tax at the company's
homeware unit rose 18% to $15.9 million as sales increased 5.3% to
The sporting goods unit boosted earnings 42% to $8.3 million as sales rose 8.8% to $77.9 million.
During the first half the company extended its Ashburton Briscoes
Homeware store and refurbished its Rebel Sport store at Manukau. In the
second half, the company will open a new Rebel Sports store at
Coastlands in Wellington in the existing Briscoes Homeware store site
and the Briscoes store will move to an adjacent larger site. It also
plans to relocate its Briscoes and Rebel stores in Wanganui to a new
purpose built location with shared back-of-house facilities.
Extensions and relocations are also planned for Briscoes stores in
Taranaki Street, Wellington, as well as Taupo and Hamilton during the
2015-2016 financial years.
By press release