Warehouse sales lift 1.9% in third quarter
AUCKLAND: The Warehouse Group says its third quarter sales rose 1.9% with its flagship Red Sheds brand returning to positive samestore sales growth.
The latest result follows 2.7% growth in firsthalf sales.
‘‘We’re encouraged that our sales are heading in the right direction as we continue to drive changes to meet changing customer expectations and leverage our group scale to operate more efficiently and deliver growth in earnings,’’ chief executive Nick Grayston said in a statement.
The Red Sheds samestore sales rose 1.7% to $363.3 million in the three months ended April 28 — overall sales were up only 0.8% because, although store numbers remained the same at 93, the square footage of those stores has been reduced.
The Red Sheds’ sales had been down 1.4% overall in the second quarter and down 0.3% on a samestore basis.
The company said margins were up across most categories and clearance improved significantly on last year but units sold were still down 0.8%.
‘‘We had a pleasing Easter performance, with seasonal confectionery unit growth up 2.4% and an improved sellthrough rate compared to last year,’’ Mr Grayston said.
‘‘Easter fell late in the year and coincided with Anzac Day and the school holidays to create favourable trading conditions, with people having more time to shop,’’ he said.
‘‘Grocery continued to trade well, particularly in confectionery and health and beauty, with Valentine’s Day fragrances popular. We are also seeing intense competition in apparel, footwear, jewellery and intimates, with units down 3.2%.’’
Warehouse Stationery sales rose 0.6%, both on a total chain and samestore basis, to $71.1 million.
‘‘It was pleasing to see a third quarter of sales growth after operation integration issues in fullyear 2018,’’ the company said.
The Noel Leeming chain’s sales rose 2.3%, with samestore sales growth of 1%, to $217.1 million.
‘‘Performance was strong across all categories, resulting in continued market share growth in a competitive market. Small appliances and audio visual and gaming categories performed particularly well,’’ Mr Grayston said.
The company’s outdoor adventure brand Torpedo 7 lifted sales 6.9% to $39.1 million with store numbers growing from 11 to 18 and samestore growth coming in at 2.3% for the latest quarter.
The group’s online sales jumped 18.7% compared with the third quarter last year and Mr Grayston said the company continued to invest in its new digital platform.
He left his fullyear guidance for adjusted net profit to come in between $63 million and $66 million, subject to any material changes in anticipated trading conditions.
Stripping out restructuring costs and the exit of the illfated financial services unit, underlying earnings the previous year were $59 million.
The shares closed at $2.12 yesterday, up 5c or 2.42%. over the day. ,
— BusinessDesk