Briscoe Group Reports Strong Sales Despite Challenges
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- Briscoe Group reported near-record sales despite facing tough economic conditions and margin pressures.
- Net profit fell by 38.9% due to a $7.4m tax adjustment and lower dividends.
- The company invested $40m in a new distribution centre to improve efficiency.
Briscoe Group has reported strong sales for the year, with revenue reaching $791.5 million, only slightly down from the previous year's $791.9 million. Managing director Rod Duke described the result as a “terrific achievement” given the challenging economic environment. Related: The Warehouse Group Reports $54.2M Loss
Despite achieving positive sales growth in three out of four quarters, net profit dropped 38.9% to $60.6 million, largely due to a $7.4 million non-cash tax adjustment. Without this adjustment, net profit would have been $68 million, marking a 19.2% decrease from the previous year.
Gross profit margins declined from 42.40% to 40.37%, which Duke attributed to ongoing economic pressures. He emphasised that while margin pressure is expected to continue, Briscoe Group is working on initiatives to stabilise profitability. These include better clearance product management, improved promotion planning, and the introduction of a new merchandise planning tool.
“We expect this will see second-half profitability exceed that produced for the first half in a return to a more normalised shape of profitability,” Duke said.
Briscoe Group’s online sales rose to 19.7% of total sales, up from 18.7% in the previous year. Meanwhile, cost control efforts kept overhead costs just 1.11% higher than the previous year.
The group’s investment plans continued, with $58.2 million spent during the year, including $40 million allocated to a new distribution centre in South Auckland. Duke said the project, currently under construction, would improve productivity and customer service.
Briscoe Group’s board has declared a final dividend of 10 cents per share for the second half, bringing the total dividend for the year to 22.5 cents per share — down from 28.5 cents the previous year.