Briscoe net profit up 14.6% excluding tax adjustment

Tuesday 8th March 2011 1 Comment

Retailer Briscoe Group reported a 14.6% rise in full year net profit to $24.1 million, when a one-off deferred tax adjustment was excluded from the result.

Group managing director Rod Duke said that during a tough year, the company had continued to focus on controlling costs, buying well and planning and implementing effective promotions.

"We have increased the aggression of our promotions and customers have responded positively to the more creative ways in which these have been delivered," Duke said today.

That had resulted in some initial margin erosion, but gross margin percentage for the second half matched the previous year.

Sales revenue for the year to the end of January lifted 0.63% to $419.3 million, although on a same store same day basis, group sales were 2.4% ahead of a year earlier.

Briscoe operates on a weekly trading and reporting cycle resulting in 52 weeks for most years, with a 53-week year once every six years, including last year.

Net profit, including a one-off $2.5 million non-cash tax adjustment, was $21.6 million for the 52 weeks of the latest year, compared to $21 million for the 53 weeks of the year before.

A final dividend of 6c per share is to be paid, up from 5cps a year earlier.

During the past year four Living & Giving stores were closed, taking the number of homewares stores to 54, while sporting goods store numbers were unchanged at 32 although the relocation of two Rebel Sport stores slightly decreased total floor area.

On a same store same day basis, homewares sales were up 1.98% and sporting good sales up 3.31%.

Duke said all the group's seven Christchurch stores opened within a short time of the initial Canterbury earthquake on September 4 and had been trading at a reasonable level, but the second quake on February 22 did further damage to some stores, and the full level of damage to two stores was still being assessed.

Costs and lost profit resulting from the earthquake were covered by insurance policies.

During the latest year, Briscoe Group had capital investments of $4.8 million, with Duke saying the programme of store opening and refurbishment had stepped up from the previous year's rather subdued level as the storm of the economic downturn was weathered.

The company would continue to look for opportunities in the main centres to establish large format Briscoes Homeware stores. It had future-proofed its presence in the Wellington CBD with the purchase of two properties that settled early in February this year, Duke said.

Briscoe Group expected to continue to strengthen its position in homeware and sporting goods retail, but the extent of any improvement in financial performance would depend on the overall economic environment, which remained volatile.

Briscoe Group shares were up 4c in late morning trading to $1.40.

NZPA

Comments from our readers

On 9 March 2011 at 2:51 pm Maurice Purdy said:

Well done Rod Duke & the Briscoes Group - Fantastic to show that its possible to make it in this world when all the doomsters continually do their best to drag it all down with their focus on the bad news, if we could shut these people down in our media and encourage the Rod Oram's etc I'm sure our economy would have rebounded a lot sooner - initially a depression is only a state of mind!! I like Briscoes positivity may it become contagious.