Briscoe Group is warning of a tough year ahead after reporting a 14.6 per cent rise in full-year net profit to $24.1 million, when a one-off tax adjustment is excluded.
Group managing director Rod Duke said the relatively strong New Zealand dollar in the year ended January 30 had helped
the homeware and sports goods retailer to a "stellar" result in a tough retail environment.
"We've been buying well enough so we've been able to hold margins through the year."
Duke said this coming year had got off to a bad start with soaring petrol prices which threatened to hit all retailers.
With fuel prices over $2 a litre, consumers were near a tipping point where discretionary retail purchases would be affected.
"It doesn't seem to have gone quite as dead when we passed the $2 threshold the other time [in 2008]. But there's got to be a point where people think, 'Hang on, mum's asking me for another $50 to put petrol in the car to get Jimmy to school and down the supermarket' - that's a lot of money," Duke said.
"I don't know where that tipping point is but it can't be very far from where we are now."
Duke said the company had continued to focus on controlling costs, buying well and planning and implementing effective promotions.
"It's a stellar result in light of other listed retailers. The market's obviously very difficult out there, we're happy to confirm that but I think our people have done a sterling job."
Although the New Zealand dollar was in decline, the company was hedged at an "attractive" level for the next 12 months.
Sales revenue for the year to the end of January lifted 0.63 per cent to $419.3 million, although on a same-store same-day basis, group sales were 2.4 per cent ahead of a year earlier.
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 with $21 million for the 53 weeks of the year before.
A final dividend of 6c a share is to be paid - 88 per cent of profit - up from 5c a share a year earlier.
During the past year four Living & Giving stores were closed, taking the number of homeware stores to 54, while sporting goods store numbers were unchanged at 32.
On a same-store same-day basis, homeware sales were up 1.98 per cent and sporting goods sales up 3.31 per cent.
Duke said the second quake on February 22 did further damage to some of the seven Christchurch stores, and the full level of damage to two stores was still being assessed.
Forsyth Barr analyst Guy Hallwright said it was difficult to compare Briscoe directly with other companies but it appeared it had taken market share off them.
Briscoe Group shares closed up 4c at $1.40.
- Additional reporting, NZPA
Group managing director Rod Duke says it's a stellar result in light of other listed retailers. Photo / Paul Estcourt
Briscoe Group is warning of a tough year ahead after reporting a 14.6 per cent rise in full-year net profit to $24.1 million, when a one-off tax adjustment is excluded.
Group managing director Rod Duke said the relatively strong New Zealand dollar in the year ended January 30 had helped
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