The week that was

David Jones NZTrading updates from anyone and everyone, acquisitions and various initiatives launched have dominated yet another busy week in retail.

The week began with Premier Investments chairman Solomon Lew using an updated copy of the Myer share register to ask its shareholders to “help” install a new majority independent board and “save” the retailer, via a letter. Though the Myer vs Premier Investments saga didn’t play out over the course of the week, which was more or less saturated by…

Brace yourselves, it’s trading update time

David Jones’ half-year operating profit fell 37.7 per cent to $66 million, after South-African based parent Woolworths Holdings said that the department stores’ top-line sales fell by 3.8 per cent in the half, while comparable store sales were 3.3 per cent lower.

Super Retail Group reported its first-half results on Tuesday morning, unveiling a 3 per cent decline in net profit to $72.2 million.

Group earnings before interest and tax declined by 1.4 per cent to $113.6 million on the prior corresponding period (PCP), while sales increased by 2.2 per cent to $1.3 billion.

The owner of retail chains including Rebel Sport and Supercheap Auto also announced it will purchase outdoor apparel and camping equipment brand Macpac Holdings for $135 million with the intention of merging the struggling Rays business into the brand.

Shops, in-store clinics and emergency hospitals helped pet care retailer Greencross lift its first-half profit 5.9 per cent to $23.2 million.

Peter Birtles, Super Retail Group

Super Retail Group’s CEO Peter Birtles is looking to merge the company’s struggling Ray’s brand with new acquisition Macpac

Online furniture and homewares retailer Temple & Webster unveiled an 84 per cent improvement in its net-losses year-on-year (YoY) for the first-half of fiscal 18, re-affirming its FY19 maiden profit timeline.

Cash Converters exceeded its net profit guidance for the first-half of FY18, but has booked double-digit declines in revenue and earnings compared to the prior-corresponding period (PCP).

Vacuum cleaner specialist Godfreys booked a $58.6 million net loss after tax for the first-half of FY18 after signalling $75.2 million in non-cash impairments earlier this month.

Autobarn owner Bapcor reported a 72.2 per cent increase in net profit to $43.5 million for the first half of FY18, bolstered by trading from the Hellaby Holdings businesses it acquired last January.

Accessories retailer Lovisa delivered double-digit earnings and revenue growth for the first-half of FY18, with international expansion driving a 22.5 per cent increase in net profit to $24.8 million.

The Reject Shop said that the creation of a more compelling offer and removing costs from the business had driven a 1.1 per cent increase in net profit to $17.7 million.

Beacon Lighting reaffirmed its commitment to delivering a record profit in FY18, unveiling a 19.6 per cent increase in net profit after-tax to $122.3 million for the half-year ended 24 December.

Accent Group – formerly RCG Corp – bucked the discretionary retail blues, recording a 19.1 per cent increase in its half-year net profit to $25.2 million.

Billabong International’s half-year net-loss deepened by 29 per cent over the prior period to $18.4 million as momentum in America was more than offset by declining earnings in Europe and Asia Pacific.

Kogan.com posted a near five-fold increase in net profit after tax (NPAT) to $8.3 million for the half-year ended 31 December.

Tag Heuer Westfield

Billions upon billions for Westfield’s owner…

Retail landlord Scentre Group recorded a 41 per cent increase in its 2017 statutory profit to $4.2 billion, driven by rising footfall at shopping centres and retailer demand.

Fellow landlord firm Stockland also announced a positive first-half trading update, with funds from operations (FFO) up 18.2 per cent on the corresponding 1H17 period to $436 million, and an increase in FFO per security of 16.9 per cent on 1H17. Stockland also announced plans for a $500 million state-of-the-art technology hub at Macquarie Park in Sydney, lodging plans to develop the first stage of the renewed innovation precinct.

Now for the big two

Retail conglomerate Wesfarmers saw its first-half profit drop 86.6 per cent to $212 million, following the $1.3 billion impairments flagged against its ailing hardware UK venture and Target discount department stores.

Net profit after tax (NPAT) for the half also decreased 2.7 per cent to $1,535 million, excluding the impairments, with Coles supermarket earnings before tax falling 14.1 per cent to $790 million following a slowdown in comparable food and liquor sales growth – from 1.3 per cent a year ago to 0.9 per cent.

Coles managing director John Durkan said he is confident that the supermarket chain is positioned for moderate earnings growth in the second-half, following a rebound in comparable sales in the December quarter.

rob-scott-wesfarmers-md

Wesfarmer’s MD Rob Scott is reviewing the struggling UK hardware venture

Wesfarmers’ department store division chief executive Guy Russo expects an improved result from Target in the second half as ongoing efforts to improve its range begin to bear fruit.

Meanwhile arch rival Woolworths Group’s half-year net profit from continuing operations increased by 14.8 per cent to $902 million, underpinned by momentum in Australian food sales, which increased by 4.9 per cent.

And now the rest

In a positive sign for retailers, The Commonwealth Bank Business Sales Indicator (BSI) showed overall spending rose 1.1 per cent in trend terms in January – the fastest monthly growth in four years.

Steinhoff Asia Pacific (APAC) secured funding from its existing banking partners with a $300m banking facility provided by its existing syndicate of six local and international banks.

Australian high-end luxury lingerie retailer, Honey Birdette, is creating a new look to prepare the brand for further expansion into the UK.

Catch Group added to its e-commerce portfolio, announcing a partnership with Optus that will see the retailer launch a mobile phone service.

New data showed Black Friday is now the second highest grossing day during the shopping season behind Boxing Day after witnessing 112 per cent revenue growth compared to 2016.

And finally, Australia’s Privacy Amendment (Notifiable Data Breaches) Act 2017 came into effect on Thursday with almost every business affected.

Let’s see what is on the cards next week…

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