First the bad news, now the good

Rod Duke's troubled Briscoe Group came up with some good news yesterday - but not on the scale of December's bad news.

The company expects its bottomline profit for the financial year to be higher than the $17.5 million estimate in the December 17 warning that stripped 15 per cent from its share price.

But analysts contacted by the Business Herald expect only a slight improvement - possibly to $18 million - for the year ended January 31, compared with the previous year's profit of $23.6 million.

In other words, profit may still be down by 23 per cent when the company reports on March 18.

Briscoe shares closed up 2.6 per cent yesterday at $1.18.

The company sells homeware and sports goods, has a market value of $250 million and is 75 per cent owned by Duke.

Forsyth Barr analyst Jeremy Simpson said the new information on sales and expected profit was slightly positive but Briscoe remained a volatile performer and his firm rated the stock a cautious hold.

That contrasted with Duke's view: "It looks to us as if the business has now stabilised."

In the update, Duke said Briscoe Homeware and Rebel Sport had better-than-expected sales and margins over the three months to January 31 after a slow start in December.

Same-store sales were down by 6.2 per cent for the quarter.

That is the fifth consecutive drop, meaning it is 15 months since Briscoe reported an increase in same-store sales for a quarter.

For the year, same-store sales fell by 6.6 per cent - Briscoe Homeware falling by 4.8 per cent, Rebel Sport by 10.6 per cent.

In the December profit warning, the company had blamed a "highly competitive market" and the cost of opening new stores.

Analysts had expected Briscoe's same-store sales over the year to be hurt by a strategic shift away from heavy discounting.