The Warehouse Group has recovered from a loss-making year to profitability. But the retailer is still grappling with declining sales.

In the 12 months to August 2, the retailer achieved $3 billion in sales, down 1.9 per cent from fiscal 2025. However, the company reported an after-tax profit of $11.2 million, contrasting with a $2.8 million loss in the previous financial year.

“Despite a difficult retail environment, The Warehouse Group made meaningful progress during the year,” Warehouse Group chair John Journee said. “Sales were steady on a comparable basis, profitability improved, and the business finished the year in a much stronger position.”

Sales at the flagship Warehouse brand fell 2.3 per cent year on year, however, electronics retailer Noel Leeming drove the bulk of the group’s recovery.

Managing to increase its operating profit from $11.7 million to $21.8 million, group CEO Mark Stirton said that Noel Leeming “remained disciplined and responsive to pricing and promotional activity”.

“Our teams have worked incredibly hard through another year of significant change. We’re buying better, managing inventory more effectively, improving our ranges and pricing, and running the business with greater discipline,” he added.

“At the same time, we’re investing again in stores, the brand, customer experience, and growth. We’ve made a good start, but our ambitions are much bigger, especially for The Warehouse, where we’re determined to earn back our place as New Zealanders’ first choice retailer.”

Journee said the positive steps have come despite a challenging retail environment.

“Importantly, this progress was driven by actions taken within the business rather than an improvement in market conditions, creating a stronger foundation for the next stage of our recovery,” he said.

“While the board is pleased with the progress made, materially improving profitability remains our primary ambition.”