Briscoes on track for record profit

Retailer Briscoes has had a bumper end to its trading year and is on track for a record profit.

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Photo: RNZ

Sales for the fourth quarter were up 18 percent on a year ago to $248-million, driven by solid growth for its homeware and sports stores.

Group sales for the year ended January were 7.5 percent higher to a record $702m.

Managing director Rod Duke said the result was “fantastic” given the upheaval and uncertainty caused by Covid-19, and he believed closed borders had prompted consumers to spend domestically.

“Covid and perhaps more importantly non-travel, and cash lying around the suburbs, and people have just decided they want to spend money on their homes and money on themselves just getting fit.

“I think this may just go on a bit longer than we thought.”

Duke said consumer behaviour was also changing with Black Friday in late November, now establishing itself as the company’s biggest sales period.

“Black Friday has clearly cemented itself as the most significant promotion in the retail calendar. The Group recorded its biggest sales day ever on the Friday, surpassing the previous record day by 19 percent. Boxing Day sales were also very strong four weeks later, also surpassing the previous best Boxing Day.”

He said margins had increased after it had looked at the way managed stocks and promotions.

“The impact has reset our expectations in relation to gross margin and has been very significant.”

The company is now looking for a record full year profit of more than $70m, which would have been higher but for a lack of dividend from its stake in Kathmandu, and its repayment of $11.5m wage subsidies.

The company has already rewarded shareholders with a special dividend of 5 cents a share to make up for one cancelled last year when Covid hit. Duke said the size of the regular end of year dividend would be released next month during its earnings report.

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