Postie Plus lifts sales 23 per cent

Clothing retailer Postie Plus has lifted July-quarter sales 23 per cent above those of the same period a year ago to $38.2 million.

The annual sales increase was up 9.65 per cent to $125.4m, the company said today.

In May, Postie Plus had warned it may not live up to previous profit forecasts as unseasonally warm weather, a late Easter holiday and weak consumer spending dented April trading.

At the time, chairman Peter van Rij said a pre-tax earnings guidance of $5m given at the retailer's half year result in March was "under threat".

But today he said the directors were confident the company was back on course to reinstate the February guidance.

"We are conscious, nevertheless, that competition in our sector is unlikely to reduce and that the profit target is still not at the level we would like to see achieved on our level of turnover," Mr van Rij said.

The July quarter had run substantially ahead of the three prior quarters, and followed a disappointing 4.24 per cent growth in retail sales in the April quarter.

The group had outperformed the national retail sales trend, reinforcing the view of directors that Postie Plus was more resilient in more difficult economic conditions.

Chief executive Ron Boskell said the factors which caused a deferral of consumer spending in April had included sharply higher petrol prices and concerns about other rising costs such as mortgage repayments, electricity, local authority rates and food prices.

The latest retail sector data indicated an economic slowdown had affected most retail segments but Postie Plus' trading divisions Postie+, Arbuckles and Baby City had not been affected, he said.

"Management focus on the marketing of each of our brands as value-for-money products for middle New Zealand, our store refurbishment programme, the opening of visually attractive new stores and ongoing repositioning of our apparel, homeware and baby products has been rewarded.

"The sales we failed to make in April were delayed until May when we saw a 17.93 per cent improvement on an all stores basis and the recovery kept on rolling in June with all stores sales growth of 31.25 per cent and July with all stores sales growth of 20.98 per cent."

Postie Plus Group is to announce its full results for the year ended July 31 on or about September 22.

Postie Plus shares closed at 81c yesterday, having ranged between 57c and 83c in the past year.

- NZPA