iPod love affair figures in heartening sales

iPod sales have bucked the slowdown in mass retail sales.

New Zealanders' love affair with iPods will help local distributor Renaissance Corporation buck the trend of weakening retail sales and post higher profits for the year, the company said yesterday.

Even so, the publicly listed company's full-year profits are not expected to repeat last year's doubling.

Renaissance yesterday reported a $2.3 million net profit for the six months to June, up 18.5 per cent on the period a year earlier. Group revenues were $77.3 million, up 11 per cent.

Managing director Paul Johnston said the company was set to achieve its full-year target of 20 per cent net profit growth, indicated at its annual general meeting in May.

"That, we think, will still be quite a bit ahead of the industry. We think 20 per cent growth for the year would be a good result and is achievable," he said.

The iPod had bucked the slowdown in mass retail sales in items such as plasma TVs and LCDs.

"The consumer spend has certainly got tighter as a result of things like petrol [prices]. The iPod seems to be bucking the trend because it's still picking up as far as growth is concerned - but a lot of the other products that do traditionally well in retail have certainly seen a slowdown."

Johnston said solution-based, IT resellers had experienced good growth, balancing the retail slowdown. He expected more growth in iPod and said it was still in "the early stages" of life. Customers upgraded to new models for new features and for greater capacity.

"We absolutely know that there's an awful lot of people around who are on to their third iPod," he said.

"Often they get passed down in the family or they get sold on to other people. People are very keen to keep up with the technology."

He said around 85 per cent of all MP3 players sold in New Zealand were iPods.

Renaissance Corporation shares closed down 2c yesterday at $1.36.