SUPER GROUP TIPS SWITCH IN SALES
SUPER Retail Group chief executive Anthony Heraghty believes the owner of retail chains such as Supercheap Auto and Rebel can still trade strongly at a time when interest rates and the cost of living are hitting discretionary spending, with his customers still filling their baskets – but possibly trading down to cheaper product lines.
Revealing the retailer’s interim results on Thursday, Mr Heraghty said his shoppers might migrate to a cheaper fishing rod at his BCF stores or spend slightly less on a new tent or gym equipment but that his portfolio of retail businesses had proven it could maintain its sales and earnings trajectory through the economic cycle.
“A brand like Supercheap, what we start to see is customers change their behaviour in terms of the type of product they are buying,” he said. “So we end up going to potentially lower cost, high frequency (purchases) where people get out of car care and get into car maintenance.
“You start seeing in sport potentially buying less for mum and dad and more for the kids, and at BCF you might go from high priced ticket items like a fish finder to a fishing rod. We see this historically in the performance if we get into tougher economic times.”
Super Retail on Thursday posted a 15 per cent jump in interim revenue to $1.96bn as net profit soared 30 per cent to $144.2m. The fatter profitability helped fund a stronger dividend payment, with the group declaring an interim dividend of 34c a share, up from 27c, and payable on April 14.
Mr Heraghty said sales momentum experienced in the lead-up to Christmas had continued into January, led by DIY car maintenance and record sporting goods sales.
While growth had moderated slightly, according to latest trading for January and early February, the CEO said it was not material and was still very early in the year.