Baby Bunting (ASX:BBN) has reported a strong FY25 result, with profits reaching $12.1 million, according to RBC Capital Markets analyst Wei-Weng Chen. This figure sits at the top end of the company’s guidance. Baby Bunting is a specialty retailer of baby goods, providing a wide range of products and services for new and expectant parents. The company operates both physical stores and an online platform across Australia and New Zealand.
According to Chen, refurbished “store of the future” locations are performing exceptionally well, trading 28 per cent above pre-refurbishment levels. This strong performance has prompted management to increase the sales uplift target from 10 per cent to a range of 15 to 25 per cent. The analyst noted that this upgrade reflects the positive impact of the refurbishment program on store performance and customer engagement.
Profit guidance for the coming financial year has been set at $17 to $20 million, representing an approximate 12 per cent upgrade to consensus expectations. This positive outlook is underpinned by anticipated comparable sales growth of 4 to 6 per cent, gross margins of 41 per cent, and the continued rollout of refurbishment and new store programs. These initiatives are expected to drive further revenue growth and improved profitability for the company.
While the overall result was positive, Chen also noted that management’s capital expenditure expectations for FY26 represent a significant increase compared to consensus estimates. The strong performance in New Zealand and the successful store refurbishments are yielding robust trading results, the company is continuing to invest in future growth initiatives.
