In November, Briscoe Group told the market its net profit would be in the range of $70 million to $77m.
In November, Briscoe Group told the market its net profit would be in the range of $70 million to $77m.
Briscoe Group has downgraded its full-year profit forecast after slower-than-expected trading in the crucial Christmas sales quarter.
In a trading update to the market, managing director Rod Duke said it now believed the group’s full-year net profit after tax would “not meet the previous range by the group butwould be greater than $66 million”.
Briscoe had previously told the market in a November update that its net profit would fall in the range of $70m to $77m.
“In line with recent reports highlighting a struggling economy and sluggish spending across retail, we are yet to see any marked improvement in consumer confidence hoped for on the back of decreases in the OCR.
“While there were some positive signs across Black Friday promotions, we believe the event was diluted by the continued economic downturn as well as the amount of promotional activity that started considerably earlier than previous years,” Duke said.
“While Christmas trading, particularly our Boxing Day promotions, improved compared to Black Friday, December trading was still under anticipated levels.”
Briscoe Group managing director Rod Duke says consumer confidence is yet to bounce back as hoped. Photo / NZME
The wider 2024 result looks to have taken a hit in its final quarter, with the group’s sales falling by 0.28% in the 48 weeks to December 29.
Homeware sales fell 0.29% year on year while sporting goods fell by 0.26% year on year.
Duke said finishing at 99% of last year’s record full-year sales would be “a significant achievement”, and hoped by the end of the financial year on January 26 that it would be the case.
“The current highly competitive retail environment continues to place pressure on both gross margins and bottom-line profit. We continue to focus on controlling costs and ensuring the closing inventory position optimises both cost and quality,” Duke added.
“A benefit of trading as hard as we are throughout this fourth quarter, will be a January year-end inventory position which will close under last year and ensure the group is extremely well placed for our new financial year.”
Earlier in the financial year, Briscoe Group released a positive third-quarter result despite economic pressures affecting the retail industry.
Unaudited group sales of $546.1m were half a percentage point down on the same period last year.
However, recent Labour Day sales would be recorded in the November accounting period instead of October, contributing to a half percentage point increase.
Tom Raynel is a multimedia business journalist for the Herald covering small business and retail.
