The Warehouse says it is well prepared to weather an expected slowdown in consumer spending.
In a report ahead of its first quarter sales results, The Warehouse said retail sales growth was likely to slow relative to the 2007 financial year, as discretionary spending came under further pressure
from macro economic factors.
The company, which runs 85 Warehouse New Zealand stores and 43 stationery stores, is due to release first quarter sales on Wednesday. The Warehouse managing director Ian Morrice said he expected retail spending to tighten in the medium term as the economy softens, but it was a situation the company was well prepared for.
"Our performances this year have shown that we can continue to perform positively at a time when others have found the going very tough," he said this week.
"Customer value expectations are changing rapidly. We are responding to these changes across both businesses, through investing in a step-change in presentation and shopping experience, tangible improvement in product quality and choice, and maintaining our price leadership position."
Chairman Keith Smith said that with the important Christmas period imminent it was too early to predict the level of investment planned for the business and increasing net profit will be difficult.
He said shareholders could expect to see balance sheet changes next year as the financial reporting system changed.
For the year ended July 29, The Warehouse achieved sales in New Zealand of $1.76 billion, and profit of $115.5 million.
- AAP
