Super Retail Group profit drops

Super RetailSuper Retail Group has suffered a 25 per cent slide in its full year profit following costs linked to the restructure of some of its businesses and the closure of its FCO chain in New Zealand.

The company, which owns the Supercheap Auto, Rebel Sport and BCF chains, made a net profit of $81.1 million for the year to June 30, down from $108.4 million a year ago.

The result was weighed down by $12.8 million in costs linked to the restructure of the group’s Ray’s Outdoors, integrating the Workout World businesses into Rebel Sport, and a $16.2 million loss from the closure of FCO Fishing Camping Outdoors in May.

Total sales for the year were up 7.1 per cent to $2.24 billion.

“Our strategy is delivering pleasing results,” said SRG chief executive Peter Birtles.

“The auto and sports retailing division experienced strong like for like sales growth during the year, underperforming businesses were restructured or closed as part of a strategic review to drive long term growth, and we continued to advance our multichannel capabilities,” he said.

Supercheap Auto’s EBITDA increased 3.2 per cent to $119.4 million and nine new stores were opened. The division recorded overall sales growth despite weaker growth in its home state of Queensland, which was the only state not to record sales growth. Birtles also commented gross margin lifted despite increased purchasing costs caused by the lower Australian dollar.

In leisure retailing, BCF was also impacted by a weaker Queensland economy but still delivered solid like for like sales increases in the second half.

In sports retailing, Rebel Sports and Amart Sports generated strong like for like sales and EBITDA increased 10.8 per cent to $93.2 million. However the segment was dragged down by the performance of Workout World and Infinite Retail.

“The business assumed control of the Infinite Retail business during the year and has started to integrate the business more closely, recognising costs adjustments which have resulted in a share of losses of $3.6 million,” Birtles said.

Birtles said SRG would look to lift its revenue for the year ahead by opening between 20 and 30 new stores across the group and growing like for like sales.

“We expect overall retail growth in our markets to be modest given patchy consumer confidence and our higher exposure to the Queensland economy, but we expect to achieve solid like for like sales growth driven by market share growth in all our businesses,” he said.

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