Market rewards Briscoe's good fourth quarter sales figures

By NZPA

Monday 3rd February 2003

The market welcomed news that retailer Briscoe Group rang up a hefty 17 percent increase in sales during the fourth quarter.

Shares in Briscoe Group, which owns the Briscoes Homeware and Rebel Sport chains, shot up 8c this morning to $2.78 before easing back 3c, compared with a high of $2.83 on December 17.

The company's share price gained 103 percent last year, and was the top performing stock on the New Zealand Stock Exchange's top-40 index.

Forsyth Barr Frater Williams analyst Jeremy Simpson said the company still had scope to expand its Briscoe Homeware business, both in store numbers and through refurbishment of existing stores.

The number of the large format Rebel Stores, predominantly sited in the larger centres, could "comfortably double", Mr Simpson said.

Three more Rebel Sport stores are planned for 2003. Properties have been bought in Nelson and Hastings, with the Nelson store set to open in the first half of the year.

The company also plans to open a Rebel Sport and a new Briscoes Homeware store in Lower Hutt in the second half, bringing the total number of Rebel Sport stores to 15 and Briscoes Homeware stores to 29.

Mr Simpson said the result was in line with expectations.

"The key thing was the strong sales number, but strong sales had been expected by the market, so it was confirmation of a very strong Christmas period."

The group, which has a market capitalisation of about $577.5 million, said it was on track to post a "satisfactory increase in profits for the full year".

"Everyone was expecting something good and they have delivered and it bodes well for The Warehouse," ASB Securities broker Andrew Kelleher said.

Companies which did not live up to promises were punished heavily in the current market, but those that did were rewarded, Mr Kelleher said.

The group clocked up $103 million in sales in the three months ended December 31, against $88 million a year earlier.

Sales for the year to December totalled $295 million, an increase of 17 percent on the previous year.

Briscoes Homeware sales increased by 17 percent to $72.4 million during the period, while Rebel Sport sales increased by 19 percent to $30.7 million.

The figures are unaudited.

Expectations were high when Briscoe shares listed in December 2001 at $1.40, a 40 percent premium to their $1 issue price, with analysts picking they would reach up to $4 within two years.

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