Briscoe Group reports record full-year sales but expects dip in net profit

Briscoe Group has reported record full-year sales but says the challenging retail environment will continue in 2024. Photo / Warren Buckland

Retailer Briscoe Group has reported record full-year sales after a strong second half but still expects a drop in net profit.

The group, which owns the Briscoe Homeware and Rebel Sport brands, achieved sales of $792 million in the year to January 28, up 0.78 per cent.

Its homeware sales were up 0.54 per cent on the previous year, and sporting goods sales up 1.17 per cent.

Second-half sales, for the 26-week-period ended January 28, were up 1.15 per cent to $422.7m from the same period a year ago.

The group expects full-year net profit after tax (NPAT) to be “in excess of $83m which will represent at least 94 per cent of last year’s record NPAT”.

Last year Briscoe Group recorded a net profit of $88.4m.

Group managing director Rod Duke said the result would still represent “a remarkable performance given the difficult trading conditions experienced across the retail market”.

“We believe the challenging retail environment will continue into the 2024 calendar year and do not underestimate how difficult trading will be. However, we have a very strong core business which has proven to be very resilient, exciting initiatives to drive growth and an incredibly talented team which positions the Group to continue to outperform most other retailers in New Zealand,” Duke said in the company’s announcement to the NZX today.

“Our business model has again demonstrated how relevant and flexible it is irrespective of existing economic conditions.”

Duke said estimated gross profit margins would be at least 42.3 per cent and closing inventories to be at least $10m below last year.

“Gross margin remains an important focus for the group and despite increasing margin pressure from the impacts of weaker economic conditions, I’m extremely proud that we will meet our goal to protect around half of the 633 gross profit basis points gained during the two years ended January 2021 and January 2022,” Duke said.

Duke said managing inventory levels had been essential in delivering sales growth.

“We have invested considerable energy into refining how, when and what we purchase, as well as improving a number of other inventory measures,” he said.

“Whilst there are still some year-end procedures to be completed to determine the final inventory value, the group will close our financial year at least $10m under last year’s closing value of $117.8m.”

Briscoe Group’s full-year results, including the final dividend, will be announced on March 13.