Briscoe lifts first-half profit

briscoeBriscoe Group, which operates stores selling household items and sports goods, lifted first-half profit 4.8 per cent and said it was satisfied with the result in the face of ongoing competitiveness and unusual weather conditions.

Profit increased to $28.6 million, or 12.73 cents per share, in the 26 weeks ended July 30, from $27.3m, or 12.21 cents, in the year earlier period, the Auckland-based company said in a statement.

The result includes a $1.6m dividend from its 19.8 per cent stake in outdoor retailer Kathmandu. Sales rose 4.4 per cent to $280.3m.

Managing director Rod Duke, who owns more than three-quarters of the company, said the first half was impacted by a number of challenges including fires in Christchurch in February, a major flood in Edgecumbe in April, a relatively late start to winter across the country, warmer than average temperatures in Auckland followed by intense cold, snow and heavy rain during July.

The group’s gross margin slipped to 41.03 per cent from 41.89 per cent while its inventory value increased 8.4 per cent to $85m as more stock is held for online retail and it was left with higher than anticipated seasonal stock.

“Despite the ongoing competitiveness of the retail environment and the impact on winter-dependent categories with the late start to the colder months, overall we are satisfied with the positive sales and profit growth achieved for this first six months,” Duke said.

In the first half, earnings before interest and tax at the company’s homeware unit dropped 0.7 per cent to $22.4m while sales increased 4.6 per cent to $178m. Meanwhile the sporting goods division lifted ebit 1.6 per cent to $14m as sales advanced 4.2 per cent to $102.3m.

“We continue to experience excellent growth through our online channels which now represent more than 7 per cent of the total group sales,” said Duke. “The number of fulfilment stores has helped to improve online capacity with further additions planned for later in the year.”

A new Briscoes Homeware store will open next week at Rangiora in Canterbury and a new Briscoes Homeware store at Glenfield Mall in Auckland is expected to open before Christmas. A new Rebel Sport store in Kerikeri is planned to commence trading early next year.

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