Retail sales surge on supermarket, petrol spend

File photo / NZ Herald
File photo / NZ Herald

New Zealand retail sales grew more than expected as people bought more at supermarkets and spent more on petrol in the final quarter of 2011.

The total volume of spending rose 2.2 per cent to a seasonally adjusted $17.37 billion in the three months ended December 31, according to Statistics New Zealand. That's more than the 0.8 per cent pace forecast in a Reuters survey of economists.

Excluding motor-vehicle related spending, core retail sales grew 2.9 per cent to $13.7 billion, the fastest pace since the series began in 1995.

The value of retail spending, which accounts for both sales volume growth and rising prices, climbed 2 per cent to $17.67 billion, and was up 2.3 per cent excluding auto-related spending. Retail expenditure was up an actual 8 per cent to $19 billion, well ahead of the 5.5 per cent growth economists were picking.

Spending on supermarket and grocery items climbed 1.3 per cent to a seasonally adjusted $4.5 billion, while fuel expenditure climbed 6.4 per cent to $1.92 billion.

In volume terms, supermarket spending rose 1.8 per cent, while fuel spending increased 4.8 per cent.

"Big increases in supermarket and fuel sales have boosted this quarter's figures," said business statistics manager Louise Holmes-Oliver in a statement. "Rugby World Cup visitors and the delayed start to the spring school holidays have probably contributed to the big sales increases we've seen in these two industries."

New Zealanders' appetite to spend has been muted over the past 18 months as households repaid debt rather than borrow to buy things, and the latest ANZ Roy Morgan consumer confidence survey found people were "listless and fickle".

Still, spending on credit and debit cards rose last month, signalling an improving mood, and New Zealand retailers have had mixed results over the summer.
Last month, Warehouse Group, the nation's biggest listed retailer, cut earnings guidance and blamed tighter margins in the apparel segment, while clothing retailer Hallenstein Glasson reporting a 25 per cent lift in first-half earnings and homeware chain Briscoe Group flagged a bigger annual profit.

The value of spending on clothing, footwear and accessories was edged up 0.1 per cent to $896 million in the quarter, with volumes up 0.8 per cent.

Retailers selling electrical and electronic goods continued to discount their products, with the value of spending up 7.2 per cent to a seasonally adjusted $714 million on a 10 per cent increase in the volume sold. Statistics NZ said some respondents reported smartphone sales had a positive impact on the figures.

Competition has been tight in consumer electronics, with Woolworths recently saying it will shut stores in its Dick Smith chain and ultimately put the retailer up for sale. At the same time, ASX-listed JB Hi Fi reported New Zealand was the stand-out performer in its recent first-half earnings.

The latest period captures the finals rounds at last year's Rugby World Cup, and today's figures show the value of spending on accommodation and food and beverage services rose 3.4 per cent to $1.78 billion and 3 per cent to $1.78 billion respectively.

It also captures the traditionally busy Christmas period, and spending at department stores increased in value by 5.6 per cent to $959 million on a 7.2 per cent lift in volume. Bolstering that figure was the reopening of two Christchurch department stores in the quarter.

The value of actual retail stocks crept up 0.3 per cent to $6.28 billion at the end of the December quarter, led by a 26 per cent increase at department stores to $717 million, and a 13 per cent rise in food and beverage services to $132 million.

- BusinessDesk

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