Australian retailer Baby Bunting has increased the lower end of its FY25 profit guidance following the recent successful launch of its new store format.
The baby goods retailer – which sells across various categories including clothing and footwear – now expects its net profit after tax (NPAT) to be in the range of $10 million to $12.5 million, upping the lower end from $9.5 million originally.
According to Baby Bunting, a significant proportion of second-half sales are attributable to the final six weeks of the financial year, and accordingly the FY25 result will be influenced by the performance of this key trading period.
As at April 27, 2025, Baby Bunting’s second-half comparable store sales so far were up 3.7 per cent, with year-to-date comparable sales up 2.9 per cent.
Year-to-date gross margin is 40 per cent, up from full year FY24 margin of 36.8 per cent.
The group added that it continues to make progress against its strategy, with improved sales momentum supported by new product ranges, optimised pricing, and targeted marketing. This includes targeting the soft goods market, including clothing and footwear, which is around double the size of the hard goods market which Baby Bunting holds 23 per cent share of.
Soft goods – which also includes food, formula and feeding as well as nappies, and health and beauty – is $3.4 billion, which Baby Bunting believes it holds 3 per cent of the market.
The latest updates comes as the baby goods retailer launched its new store format in Maribyrnong, Melbourne, in an updated store spanning 2,000 square metres.
The newly refurbished store has an activity-led format, designed to better present product categories and enhance the in-store shopping experience to drive basket size and visitation, as well as maximising retail assets to showcase brands and drive retail media opportunities according to Baby Bunting.
“Our ‘Store of the Future’ format is the physical manifestation of our strategy, delivering an elevated experience for new and expectant parents while strengthening our leadership in specialty baby retail,” CEO Mark Teperson said.
“While the store only re-opened 10 days ago, the initial feedback from customers has been very positive. It’s performing above expectations on sales and margin, with excellent growth across all product categories.
“We’ll be monitoring performance over the coming months to get a better read on the longer-term trends of this updated design. We’re excited for this format to set the blueprint for future store developments and refurbishments across our network.”