Briscoe Group warned yesterday that its half-year profits would fall by a third but promised a full-year turnaround.
The Rebel Sport and Briscoes Homeware group's interim profits are now set to fall from last year's result by $3 million to $3.5 million to about $6.5 million.
It had earlier flaggedthe profit fall, but the shares still fell 3.57 per cent to close at $1.35, in a nervous market.
Managing director Rod Duke said the figures, due on September 6, would confirm business fundamentals remained strong.
The second-quarter group sales of $71.4 million to July 31, while down 1.33 per cent from the same period the previous year, had generated significantly fatter margins.
However much of that was offset by the cost of new stores. Duke said the second half would generate 60 per cent of sales and an "even larger" share of annual profit.
The company expected to "recover most of the profit shortfall experienced in the first half of this year".
Analysts met Duke's bullish optimism with caution. Market estimates were for a full-year profit at about $21 million, down from $23.6 million in the previous financial year which was, in turn, flat on the year before.
Such a recovery from such a miserable first half would require growth in the second half of about 20 per cent in a macro environment expected to slow on the back of rising interest rates.
Duke said he did not believe that Briscoe Group would suffer from the macro environment.
"It will become evident on September 6 why I am so confident. I'm just a bit bloody irritated I am not able to field [questions] adequately because our half-year numbers will tell a rather encouraging story."
He said the comment was based on encouraging growth in recent months.
Briscoe Group restructured its marketing strategy at the beginning of the year.
It cut down on constant sales and created more stylised advertising. It also gained naming rights for rugby's Super 12.
