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Briscoe first half profit to rise by 10% on Q2 sales

Briscoe first half profit to rise by 10% on second quarter sales

By Jason Krupp

Aug. 5 (BusinessDesk) - Briscoe Group, the homeware and sporting goods retailer, says first-half net profit will come about 10% higher than last year on the back of improved second quarter sales.

Net profit was at least $10.2 million in the six months ended July 31, up from $9.3 million in the same period previously, the company said in a statement today. That's on a 4.8% rise in second quarter group sales to $97.8 million compared to the same period last year, led by a 6.3% improvement in sporting goods sales and a 4.2% rise in homeware sales.

"Pressure on gross profit margin has remained strong during this second quarter reflecting competitive market pressures and tight inventory control to ensure optimal stock levels are met," said managing director Rod Duke, who owns 75% of the company. "Notwithstanding the continued tough operating conditions, group EBIT has tracked above last year during this first half and we expect this to be reflected in our results for the half year."

The company’s shares were unchanged at $1.43, and have gained 6.7% so far this year. That’s in a day where the NZX 50 Index sank 2.4% following global markets lower.

The improved results comes after sales in the first three months of the year were flat, a reflection of the tough retailing environment seen in the first quarter when the effects of Feb. 22 earthquake in Christchurch kept consumer spending at subdued levels.

On a same store basis, group sales were 8.1% higher in the second quarter than the same period last year, although the company said figures were calculated on a different basis than in the first three months of 2011 as they accounted for the closure of eight Living & Giving stores as well demolition of the company’s Salisbury Street store in Christchurch.

The July quarter sales figure takes unaudited sales for the half year ending July 31 to $194.1 million, an improvement of 2.1% on last year's first half results, with sporting goods up 3.4% and homeware up 1.5%. On a same store basis, first half sales rose 4.4% on the same period last year.


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