Postie Plus sales up but clouds on the horizon

Sales at retail chain Postie Plus Group are up but consumer confidence is down was the mixed message from the annual shareholders meeting in Christchurch yesterday.

Acting chief executive Ron Boskell said first-quarter revenue was up 5.3 per cent - $24.81 million compared with $23.56 million for the same period last year.

However, he sounded a note of caution, saying consumer confidence was reported as low, "which makes us mindful of the need to promote our value product strongly in the months of December and January".

A significant contribution to overall growth came from new store developments.

The group, which includes Arbuckles and Baby City brands, opened eight branches last year, closed six and this year has opened two cluster developments with two more next month.

Boskell said further expansion in the new year would see total store numbers rise to 118 with 14 cluster developments.

Although same store sales were down 3.1 per cent for the quarter, they rallied in October to finish up 3.4 per cent for the month.

August and September sales were down on last year because of an aggressive approach to clearing winter stock. Boskell said the benefit of this would be realised next year with fresh winter collections "rather than a collection of carry-forward stock". The new approach to stock clearance would reduce inventory and increase flexibility.

Boskell said he sympathised with shareholders who "feel let down with our results" but said the company had addressed several issues including cost savings.