One of the best performers in yesterday’s market-wide slide was the Super Retail Group which rode out the sluggish retail sector in the year to June and seems to have managed to overcome a wage underpayment scandal, even though there will be an added cost from it in 2019-20.
Well, that sort of went over like a lead balloon. What looks like to have been an attempt by Super Retail group to spin the bad news of a $34 million underpayment with staff with most of the interim financial results yesterday flopped, judging by the way the shares traded through the session.
First half results revealed solid margins and steady sales and Deutsche Bank observes the recently-acquired Macpac business produced a good result that reflects significant investment undertaken in the supply chain over the last 2-3 years.
Sales growth was recorded across all divisions over the first 16 weeks of FY18. This is broadly in line with UBS forecasts for the first half, with automotive business a touch stronger and sports a touch softer.
Super Retail delivered a largely in-line but higher quality result, the broker suggests, featuring the benefits of prior loss-making businesses either being closed or turned around. Salas accelerated in Auto but also Sport, while Leisure saw strong margin improvement.