Warehouse Group expects to double profit

The Warehouse Group expects to double its full-year profit as it benefits from strong trading and restructuring.

The retailer expects to post adjusted profit for the full year of more than $160 million, it said in a statement to the NZX yesterday. That is up from $80.7m last year.

Retailers have benefited from increased spending because of Covid19 as money normally channelled to overseas travel was instead spent locally, with its sales in the 39 weeks to May 2 up 15 per cent to $2.6 billion.

The company is also seeing the benefits of a major restructuring that resulted in it closing stores, cutting jobs, reshuffling rosters and improving its buying and pricing practices.

‘‘While we believe that there are positive consumer tailwinds, we believe that we are seeing strong continued benefit from many aspects of the transformation that has been under way for the last few years,’’ said chief executive Nick Grayston. ‘‘However, the future remains uncertain . . .’’

In the third quarter ended May 3, group sales were up 35 per cent to $791.2m compared with last year and 11 per cent ahead of 2019. The company said last year’s figures were affected by disruption to operations and store closures due to Covid-19 and 2019 figures were a clearer performance comparison.

Online sales jumped 60 per cent in the third quarter compared with 2019 levels, and represented 10.8 per cent of total sales in the quarter, compared with 7.5 per cent in 2019.

Third-quarter trading was underpinned by significant growth for electronics retailer Noel Leeming, where sales were 36 per cent ahead of last year at $263m, and 21 per cent ahead of 2019 levels, helped by strong communications, computers and whiteware sales, the company said.

The group’s sports goods retailer Torpedo7 lifted third-quarter sales 61 per cent to $35.4m compared with last year, and up 30 per cent from 2019 levels.

Its largest business, discount department store chain The Warehouse, increased sales 38 per cent from last year to $409.9m, up 6.1 per cent from 2019 levels.