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Briscoe braces for long-term impact of Covid-19

Homewares and sporting goods retailer Briscoe Group said it is taking steps to minimise the long-term impact of the coronavirus health crisis on the business.   

Group managing director Rod Duke said while the uplift in sales for the second quarter had been very pleasing, he is extremely conscious of the need for continuing caution in relation to future negative impacts of the Covid-19 pandemic on key economic indicators such as consumer spending and unemployment, particularly in September when the government’s wage subsidy scheme ends.

“As previously disclosed the group has taken many steps to help minimise the impact of Covid-19 on the second quarter including negotiating equitable solutions in relation to a wide range of trade and non-trade expenditure with landlords and suppliers, salary sacrifices across the senior leadership team, reduction in directors’ fees, cancellation of final dividend and uptake of the first round of the government’s wage subsidy scheme,” Duke said.

He added that the health and wellbeing of customers and the team, and the protection of existing jobs and incomes are still top priorities.

According to Duke, the impact of Covid-19 caused volatile sales patterns across the first half of the year, but like many other retailers, it has experienced a significant lift in sales since the lockdown was lifted on May 14.

“This gave our second quarter numbers a welcome boost,” he said.

Briscoe posted a 28.24 per cent increase in unaudited sales for the 13 weeks to July 26 to $195.4 million from the $152.3 million achieved for last year’s second quarter.

The group’s homeware segment increased sales by 25.70 per cent during the period and the sporting goods segment by 33.19 per cent.

Group sales for the first half, 26-week period to July 26, decreased 3.49 per cent to $292.4 million from the $303.0 million achieved for the first six months of last year.

Briscoe’s homeware segment decreased sales by 3.74 per cent during the period and the sporting goods segment by 3.07 per cent.

“The extraordinary and concentrated increase in demand resulted in sales growth of 38.81 per cent for the group since lockdown was lifted, with online sales as a percentage of group sales recorded as 16.1 per cent for the same period,” Duke said.

He added that the unexpected strength of the sales rebound since the end of the lockdown together with the cost saving measures earlier outlined have all positively impacted the business.

“We now expect to report a first half profit which is much closer to last year, including the positive impact of accounting changes expected to be booked in relation to the reintroduction of tax depreciation on commercial and industrial buildings as part of the Covid-19 Response (Taxation and Social Assistance Urgent Measures) Act,” he said. “It is important to note that this is an accounting adjustment only and has no cash impact.”

Briscoe Group said it is expecting to release its half year results on September 8.

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