Postie Plus turns in improved second half

Postie Plus turned in a sharply improved second half result today.

The company reported a July year net profit of $1.67 million compared with $4.02m in 2004. It posted a second half result of $2.14m compared with a first half loss of $470,000.

Annual operating revenue was $114.3m against $108.5m last year and second half revenue was $59.1m against the first half of $55.23m.

The pretax year profit was $2.56m against last year's $5.99m.

Profit for the second half was above the guidance given in January.

While operating revenue was comfortably above the previous year, same store sales were down 2.25 per cent. However, the company said that this was more than offset by $2.9m of additional sales from new stores and considerable rationalisation of costs.

A fully imputed dividend of 3.0cps will be paid on December 12, down from last year's 4.06cps. No interim dividend was paid so the total dividend was well down on last year's 7.06cps.

The company said its leading chain Postie+ had continued to strongly underpin overall performance with 6.2 per cent same store sales growth across the full year.

Conversion of the Auckland Rendells branches to Postie+ had been a success story and most were in the top ten Postie+ branches in terms of sales and profitability.

The Postie+ chain remained under-represented in Auckland.

The Arbuckles chain had had a "demanding" year in a competitive, heavily promoted market, the company said.

It was trialling a smaller store format with encouraging results to date.

Nursery retail chain Baby City was expanding and showing consistent improvement in profitability.

The company said its plan to cluster its stores was working. The company was aiming to simplify and centralise various business functions to reduce overheads.

The company said a variety of divergent indicators made the macro outlook relatively difficult to read.

"While the warm late winter and early spring have not been helpful, the prospect of tax relief is a definite positive."

"The group is confident that its internal initiatives will continue to provide good momentum," the company said.

Postie Plus shares last traded at 71c. They have traded between 58c and $1.37 in the last year.

- NZPA