Better rollout a shot in arm for retailers

BEST & Less chief executive Rodney Orrock has called on all governments to ratchet up the pace of the Covid-19 vaccination campaign to inject consumer confidence back into the economy.

Speaking after Best & Less made its $60m stockmarket debut, the newest CEO of a publicly listed retailer said he was looking for a faster vaccine rollout.

“My view on the vaccination rollout is they need to do a lot more, a lot faster,” Mr Orrock said as shares in Best & Less offered to the public at $2.16 surged as much as 7 per cent to be trading at $2.31 in late trade. The debut gave it a market capitalisation of about $271m.

“And my view is that it will provide significant confidence to the sector and to our consumers. I can’t reiterate what everyone is telling our leaders to do more than focus on getting this bit absolutely right and getting it done as quickly as they possibly can.”

Previously the introduction of the first round of vaccines had proved a godsend for consumer confidence. In May, before the Delta strain of Covid19 swept Australia, women’s fashion chain owner Noni B said the vaccination of older people was having an interesting side-effect of giving them the confidence to leave their homes and shop.

Private equity firm Allegro Funds bought Best & Less, along with Harris Scarfe, in 2019. Following the IPO it will collect about $90m and has sold down its stake in Best & Less to 43.5 per cent from 64.4 per cent. Retail entrepreneur Brett Blundy pre-IPO invested $40m for a 16.4 per cent stake in the retailer.

Best & Less will battle for shoppers within the general merchandise and discount department store space as a public company where it will compete with well-funded rivals such as Kmart and Target, owned by Wesfarmers, and Big W, owned by Woolworths.

And it all comes during a Covid-19 pandemic.

“We have been through many of these iterations in the past, and you become better at what you have learnt, from what you have done well and what you might have not done so well in the past,” Mr Orrock said.

In a trading update before its shares hit the market, it said the disciplined execution of the Best & Less group’s growth strategy had delivered a strong fiscal 2021 trading performance, exceeding 2021 prospectus forecasts on all key metrics including revenue, gross profit, EBITDA and net profit.

Best & Less said it expected to achieve its prospectus pro forma EBITDA and net profit forecasts for calendar 2021 of $62.4m and $41.3m respectively, and first half 2022 of $40.2m and $26.9m respectively.