Parent of national retailer Mitre 10 slips into red, records $67m loss

Mitre 10 is continuing to open and upgrade its stores.

The parent of national retailer Mitre 10 has issued its latest accounts, recording a $67 million loss, which was down on last year’s minor $1.8m profit after expenses rose from its big information technology upgrade.

Revenue for the chain’s parent entity, Mitre 10 (New Zealand), rose from $307m to $315m from June 30, 2022 to 2023 but so did expenses, up from $155m to $196m.

The business is New Zealand’s largest home improvement and garden retailer and its accounts appeared on the Companies Office website within the past two days.

The co-operative-based business has been upgrading its IT systems across its network and support centre.

Financial statements for the group show how it provides services to the owner/operators whose accounts don’t appear as part of the group’s, in a similar co-operative structure to supermarket giant Foodstuffs.

The business has around 84 stores, employing more than 8000 people and says it supports around 500 local suppliers throughout New Zealand.

The co-op was at risk of breaching its lending covenant with the Bank of NZ in the December 2023 and March 2024 quarters, the accounts showed. The group said it is investigating significant expenditure on customising and configuring cloud-based software.

Gross profit for the business, chaired by Martin Dippie, dropped marginally, from $122m last year to $121m in the past year. Total current assets stood at $222m, down slightly from the previous $226m.

The company, headquartered at 67 Corinthian Dr in Albany, owns property that it leases to owner/operators, earns rent, makes loans and is involved in finance.

The co-op is continuing to open stores.

In August, the Herald reported Silverdale getting a splash of black and orange with the opening of a 1.1ha $30m-plus Mitre 10 Mega store where customers can expect some differences.

Jules Lloyd-Jones, chief marketing officer for the co-operative, said Silverdale would be the 85th store and have a footprint of more than 11,000sq m - around the same size as Westgate’s Costco Wholesale.

Several changes were made in design, layout and how goods are presented, she said. Digital shelf labels, a new style of showroom and a treehouse-style playground built mostly of timber are features of the shop at 35 Colin Chester Dr.

A new carpark layout designed more with pedestrians in mind and a garden centre that combines plants with landscaping features are other changes.

“This new store is piloting a number of new customer experiences, in response to extensive customer research and insights. Some changes are less obvious, like a safer and more pedestrian-friendly carpark and some will transform the customer experience, like the design guide and style finder digital experience,” Lloyd-Jones said.

Grant Fraser, chief legal and property officer at Mitre 10, said the 2.4ha site is owned by Mitre 10 Holdings, a subsidiary of the co-operative. That business has leased the site to the shop owner.

The building and land is worth more than $30 million, he said. Auckland Council valued the land at $7.4m in 2021 when it was vacant. Fraser said the development had significantly enhanced that.

Fraser said since 2016, the business had opened seven new stores “and we’ve had at least another five to six expanded or redeveloped, including plans for Timaru as well as work carried out previously at Westgate and Mt Wellington”.

Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.