As expected Brisbane-based Super Retail Group has been another retail group to have a ‘good’ pandemic.
The company owns a portfolio of outdoor and sports goods outlets (such as Rebel, BCF and MacPac), as well as one of the largest chains of automotive products (Super Cheap) and it has since the pandemic hit reported better than expected sales data for 2019-20 which it said on Monday has continued into the 2020-21 financial year.
“The Group has delivered extremely robust like-for-like sales growth in the first seven weeks of FY21, driven by increased uptake of domestic tourism and travel, exercise and fitness and outdoor leisure activities, with favourable gross margin compared to PCP,” directors said on Monday.
“Like-for-like sales include the impact of the government-mandated closure of 94 stores in Melbourne (35 Supercheap Auto; 32 rebel; 14 Macpac; 13 BCF) from week six and 21 stores in Auckland (12 Supercheap Auto; 9 Macpac) from week seven.
“Current consumer spending patterns remain volatile and the economic outlook is uncertain,” directors though cautioned.
Total sales across the group for 2019-20 rose 4.2% to $2.83 billion, with online sales accounting for 10.2% of total sales after growing nearly 45% across the year.
Like a host of other retailers, Super Retail has performed well because its chains were able to continue trading during lockdown and demand increased for things like home gym equipment, car products, and camping goods.
The company said it saw sales growing on a like for like basis (the best indicator of sales growth) close to 30% in May and June.
A 19.5 cent final dividend will be paid on September 2. There was no interim.
The final is well down on the 28.5 cents a share paid for 2018-19 and the total for that year of 50 cents a share.
That’s a good indication of the caution at board and management level heading into 2020-21, even though sales remain solid.
CEO Anthony Heraghty said on Monday the pandemic had caused a significant shift in spending habits, with its brands tipped to benefit from greater localised travel and household do-it-yourself projects.
“Keeping stores open for our customers while successfully pivoting to meet increased demand in our online sales channels has enabled the group to profitably navigate an extremely challenging period for retail and deliver 44 per cent annual online sales growth,” he said.
Despite the solid sales Super Retail reported a 20% slide in profit for the year thanks to the repayments costs related to the company’s $62 million staff/managers underpayment scandal. The company said statutory net profit after tax fell 20.9% to $110.2 million
The most significant of these was $17.1 million in wage underpayment and remediation costs, more than double the amount recorded in the prior year.
This was due to Super Retail increasing the total estimate for its wage scandal earlier this year to $62.4 million, up from $53.2 million after the company found additional team members affected by the underpayments.
Excluding the one-offs, which also include $5.5 million in restructuring costs and a $6 million adjustment for a new accounting standard, the company’safter tax profit was up 1% to $154 million.
Despite news of the jump in growth in the first seven weeks of the new financial year and a (lower) final dividend, investors were also cautious, marking the shares up 1.6% to $10.68.