Warehouse Group pulls through

New Zealand department store chain The Warehouse Group has seen a lift in sales for the full fiscal year, following its decision to delist from the Australian Securities Exchange (ASX).

As previously reported on ragtrader.com.au, the retailer announced its intention to withdraw from the Australian Securities Exchange (ASX) in April, citing high costs and a financial review which forced the company to review its duel listing on both the ASX and New Zealand Stock Exchange (NZX).

However, the company has now reported a rise in net profit after tax for the year of $89.8 million, up 15.4 per cent compared to $77.8 million last year, with same store sales up 3.8% per cent in the fourth quarter, and up 2.6 per cent for the year.

Profit before one-time items, however, dropped 14.3 per cent to $65.2 million in the 12 months ended July 29, down from $76 million last year.

Despite this, group sales for the year were $1.732 billion, up 3.9 per cent on last year with sales in the year increasing $64.4 million – the retailer's highest level of annual growth since 2004.

The group’s performance also improved significantly in the second half of the year with sales up 4.5 per cent to $794.2 million and gross profit up 5.5 per cent on the previous year.

Commenting on the 2012 results chief executive officer Mark Powell said results for the year were “driven by key categories such as technology, jewellery, health & beauty, baby care, and men’s and woman’s apparel”.

He also revealed the group's online business grew 63 per cent in financial year 2012.

“We have taken important steps forward in our strategy to be the House of Bargains and Home of Essentials, wherever our customers want to shop. Launching Red Alert, our one day deal site, and getting our full range online allows us to follow our customers and position us well for strong growth online in 2013,” Powell added.

Looking forward, The Warehouse Group chairman Graham Evans said 2012 was a critical transition year for the company to show it could grow sales and gross profit after a number of years of declining sales.

“While it is early days in our turnaround strategy Mark and his team have shown that their new strategy can drive positive momentum and we are looking forward to this continuing in 2013, resulting in an increase in earnings,” he said.

“We expect the retail sector to continue to experience mixed trading conditions in fiscal year 2013. Our earnings are significantly influenced by the Christmas trading performance over the critical January quarter, which means it is too early to provide specific earnings guidance at this stage.

“However, key elements of the group’s strategic plan including investments in store experience and multichannel, together with category and margin dollar growth strategies should ensure adjusted profit in fiscal year 2013 is above that recorded in fiscal year 2012”.

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