The Warehouse Group’s third quarter earnings surge

warehouse groupThe Warehouse Group saw a 5.5 per cent increase in third quarter sales, stating it’s on track to meet its forecast annual profit. The company, however, warned the warm autumn weather could weaken demand for some of its winter seasonal ranges.

The Auckland-based retailer saw a total revenue of $672.2 million, up 5.5 per cent, in the three months ending May 1 compared to the previous corresponding period, with a strong same-store sales performance across all its brands, which include The Warehouse, Warehouse Stationery, Noel Leeming and Torpedo7.

Company chief executive Nick Grayston said the company’s third quarter result was in line with expectations despite the impact of a weaker currency on imports.

“While this is a solid performance, particularly when we consider the impact of currency movements on our input costs, and remembering that Q3 last year was a particularly strong performance, the retail environment continues to be highly competitive and our focus remains on leveraging year-on-year profit growth for the second half year,” Grayston said.

“The third quarter results are in-line with expectations. We do note however that risk remains in some seasonal stock lines as we continue to experience a warmer autumn than forecast, which may translate through to weaker demand for some winter seasonal ranges,” he added.

The Warehouse, ‘Red Sheds’, reported a 2.2 per cent increase for the quarter to $389.3 million, compared to the same quarter last year. Same store sales increased 1.9 per cent with the ‘Red Sheds’ now having recorded 21 consecutive quarters of positive same store sales, when adjusted, same store sales increased by 2.7 per cent.

Warehouse Stationery, ‘Blue Sheds’, reported sales for the third quarter of $72.5 million, an increase of 3.3 per cent compared to the same quarter last year. Same store sales increased 1.4 per cent in the quarter with the ‘Blue Sheds’ now recording 27 consecutive quarters of positive same store sales growth. On a like-for-like basis same store sales increased by 8.7 per cent.

Noel Leeming reported 16.7 per cent increase in sales for the third quarter to $180.6 million. Same store sales increased 17.5 per cent in the quarter and on a like-for-like basis same store sales increased by 17.0 per cent.

Torpedo7 Group reported a 13.6 per cent increase in sales for the quarter.

The company’s group online sales were $40.5 million, up 22.7 per cent (adjusted for the divestment of ShopHQ) compared to the same quarter last year (up 23.2 per cent on a like-for-like basis). Strong sales were experienced across the group and new investments in online capability are being made with the new Warehouse Stationery webstore going live in mid April.

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