Briscoe expects increased profit after strong sales

UPDATED:  On the back of increased sales, Briscoe Group says it expects at least a 25% increase on last year’s reported net profit.

Unaudited sales for the fourth quarter were $146 million, an increase of 4.7% on $139.4 million for the fourth quarter of last year, the Group reported.

On a same store basis, adjusted for eight Living & Giving stores closed within the last 12 months, the homeware store demolished in Christchurch and the Rebel Sport store in Colombo street closed on January 5 for repairs, the Group’s sales for the fourth quarter were up 9.14% on the same period last year.

Homeware sales increased by 4.77% to $101.6 million, while on a same store basis they increased by 10.71%.  Sporting goods sales increased by 4.55% to $44.4 million, or 5.71% on a same store basis.

Managing director Rod Duke said with this strong finish to the financial year, Briscoe expected to report a full year tax paid profit of $27 million, a 25% increase on last year’s $21.61 million.

The fourth quarter sales mean the unaudited Group sales for the year ended January 29 increased 4.47% to $438 million from last year’s reported $419.3 million, while on a same store basis the Group’s sales for the financial year increased 7.99%.

Homeware sales increased 2.7% for the year, 7.35%  on a same store basis, and sporting goods increased 8.29% or 9.31% on a same store basis, Briscoe said.

Mr Duke said the market had responded favourably to the company's marketing initiatives during the lead up to and throughout the Christmas trading period.

“While competition remained fierce across most retail sectors, which placed some strain on gross margins, sales for the Group were consistently strong during December and also through January.”

A final full year audited result was expected on March 9, the Group said.

FIRST Union, which represented workers at Briscoes and Rebel Sports, said it was currently bargaining for a new employment agreement.  Retail secretary Maxine Gay said today's profit signal showed there was plenty of room to move for the company but that there had been very little offered in bargaining so far. She said shop workers, many of whom were on low wages, were looking for an improved wage offer.

Mr Duke said as far as he was aware, wage negotiations, which started before Christmas, were proceeding at a normal stage and he had not heard from the union recently.  He said as far as he was aware, Briscoe Group had not yet put their position to the union as both parties had determined to follow the company's traditional wage review timeline of April.  He said wages varied across the company, with some relatively new people close to the minimum wage, but that a substantial number of people were above minimum wage.

RAW DATA:

4th Quarter Sales to 29 January 2012

Same stores sales summary:

• 4th Quarter Group +9.14%

• 4th Quarter Homeware +10.71%

• 4th Quarter Sporting goods +5.71%

• Full Year Group +7.99%

• Full Year Homeware +7.35%

• Full Year Sporting goods +9.31%