A second-half turnaround for retailer Postie Plus failed to ward off a 59 per cent fall in profit for the year.
The company, which owns the Postie Plus, Arbuckles and Baby City chains, reported a $2.6 million profit for the year to July 31, down from $6 million in 2004.
That was in spite of an 11 per cent jump in profit in the second half, to $3.23 million.
The company had to overcome a $670,000 first half loss it attributed to a cold and wet summer, and poor performance by its Rendells stores.
Conversion of those stores into better-performing Postie Plus shops led to a recovery in the second half, as did cost savings from centralising buying and other processes.
Six Rendells stores made the transition, leaving just five remaining - all of which Postie Plus intends to close in the current year. It will be the end of a chain with a history stretching back a century.
"It has been almost an icon ... but we had difficulty getting an acceptable performance out of Rendells," Postie Plus managing director Paul Young said.
The converted stores, in contrast, were "tracking well" and the focus on fewer brands had cut costs.
Young said the company finished the year with its inventory in good shape despite a short winter, after working on improving stock management and stock control.
But so far in the current year, trading has been below expectations.
"We've had some pretty mild weather in July and August, high petrol prices and uncertainty around elections," said Young.
"Retail has been a little less buoyant."
He predicted conditions would lift once there was political certainty.
The company has 108 stores including 67 Postie Plus outlets, 25 Arbuckles and 11 Baby City shops.
It plans to open another five Arbuckles, a Baby City store and relocate six Postie Plus outlets in the current year as it expands "clusters" of all three stores.
Trials of a smaller Arbuckles format produced "encouraging" results and the company also plans to try a smaller Baby City format linked to Postie Plus stores.
Changes to warehousing, distribution and stock control are also expected to contribute further gains.
Postie Plus holds its annual meeting on November 24.
A second-half turnaround for retailer Postie Plus failed to ward off a 59 per cent fall in profit for the year.
The company, which owns the Postie Plus, Arbuckles and Baby City chains, reported a $2.6 million profit for the year to July 31, down from $6 million in 2004.
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