WHS
12/09/2014 08:30
FLLYR
REL: 0830 HRS The Warehouse Group Limited
FLLYR: WHS: 2014 Full Year Results Announcement and Presentation
THE WAREHOUSE GROUP LIMITED
Results for announcement to the market
Reporting Period: 29 July 2013 to 27 July 2014
Previous Reporting Period: 30 July 2012 to 28 July 2013
CONSOLIDATED OPERATING STATEMENT
2014 Full Year Performance
REVENUE
$2,650.892 million versus $2,239.532 million in 2013, an increase of 18.4 %
OPERATING PROFIT
$95.169 million versus $111.238 million in 2013, a decrease of 14.4 %
EARNINGS BEFORE INTEREST AND TAX
$118.627 million versus $189.714 million in 2013, a decrease of 37.5 %
PROFIT BEFORE TAX
$104.764 million versus $178.039 million in 2013, a decrease of 41.2 %
PROFIT ATTRIBUTABLE TO PARENT SHAREHOLDERS
$77.750 million versus $144.748 million in 2013, a decrease of 46.3 %
EARNINGS PER SHARE
24.1 cents per share versus 46.7 cents per share in 2013, a decrease of 48.4
%
Final Dividend: 6.0 cps
Record Date: 28 November 2014
Date Payable: 11 December 2014
Tax credits on final dividend: Fully imputed for New Zealand residents;
Supplementary dividend payable to non-residents.
THE WAREHOUSE GROUP REPORTS STRONG SALES GROWTH, POSITIONING ITSELF FOR THE
FUTURE
Total Group sales for the full year up 18.3% to $2.65 billion
Adjusted NPAT of $60.7 million
Reported NPAT of $77.8 million
Final Dividend of 6.0 cents per share
Auckland, 12 September 2014
The Board of The Warehouse Group today announced that the adjusted net profit
after tax1 for FY14 is $60.7million, which is within the range of $59-$62
million previously indicated to the market. Reported net profit after tax
was $77.8 million. Group retail sales for the year were $2,648.5 million, up
18.3% compared to last year. While the adjusted profit was below last year,
this reflects the strategic reshaping the Group is undertaking.
The Warehouse (Red Sheds)
The Warehouse (Red Sheds) reported sales for the full year of $1,665.2
million an increase of 4.7% or $74.1 million compared to last year. Same
store sales increased 3.2% for the year. Sales in the second half were
$745.1 million, an increase of 2.9%, with same store sales growth of 2.2%.
Same store sales in Q4 were up 1.5%.
The major drivers of sales growth in FY14 have been the store refit and
refurbishment program, better customer service through our investment in the
"Career Retailer Wage" and our "Love Your Customer" training program,
improved private label product quality and the introduction of major brands,
such as Sony, Samsung, HP and Kambrook. There have been particularly strong
category performances in womenswear, consumer electronics, gaming, baby,
consumables, small appliances, whiteware and jewellery. In spite of a late
and warm winter, overall gross margin percentage for the full year was the
same as last year. However, this was below planned levels and therefore was
not sufficient to fully cover the cost invested to enhance customer
experience, resulting in an operating profit decline versus last year.
Commenting on The Warehouse (Red Sheds) result Group Chief Executive Officer
Mark Powell said "The Red Sheds have now had 14 quarters of positive same
store sales after many years of ongoing decline. This turnaround in customer
perception has required significant investment in our stores, our products
and our people over the last three years. We expect to see operating profit
growth resume in FY15."
Warehouse Stationery
Warehouse Stationery sales were $250.6 million, an increase of 8.1% compared
to last year. Same store sales increased 5.3% for the year. The second half
saw sales of $129.0 million up 7.6% and same store sales growth of 5.7%.
Same store sales in Q4 were up 5.3%. Warehouse Stationery has now had 20
quarters of same store sales growth. This sales growth is translating into
significant operating profit leverage, with an increase in FY14 of 14.3%
versus last year to $11.8 million.
The rebranding of Warehouse Stationery around the "Work, Study, Create,
Connect" positioning has helped drive growth. The year saw another 3 stores
opened as part of the continued rollout of a nationwide store network.
Noel Leeming
Noel Leeming sales were $620.5 million with same stores sales increasing 5.6%
for the year. The second half saw sales of $291.8 million, up 6.7% and same
store sales growth of 2.2%. Same store sales in Q4 were down 2.1%. While
the same store sales growth softened in the fourth quarter, this was expected
as the closure of Bond & Bond annualised, and the sector cycled the iPhone 5
launch in FY13. However, Noel Leeming continues to be the market leader and
continues to outpace its rivals, growing market share in the last year and in
the softer fourth quarter. Operating profit was $11.3 million, in line with
expectations.
Noel Leeming has just launched its rebranding, based on delivering the right
product, at the right price, with leading services, delivered through
passionate people with expert service. Competitive advantage will be
achieved through our team, with product knowledge, advice and service as a
key differentiator.
Torpedo7 Group & Multichannel
Torpedo7 Group sales were $107.7 million, with an operating profit of $1.1m.
FY14 was a year of substantial change, with the integration of the
acquisitions of No.1 Fitness, Shotgun and R&R Sport, along with the opening
of a new fulfilment centre in Hamilton. The business is now well positioned
to be launched as a leading multichannel outdoor, adventure sport business,
with strong growth potential.
The Warehouse Group
In announcing the result, The Warehouse Group Chairman Ted van Arkel said
"While our adjusted profit has reduced from the previous year, the company
has been significantly reshaped and is well positioned for the future. The
board understands that this now has to be leveraged into profit growth, and
management is very focused on achieving this. The Group's strategy has
evolved and comprises five key result areas: Keeping the "Red Core" strong,
Growing "Non Red" profit to be as large as "Red", Being the leading
Multichannel and Digital retailer in NZ, Being a leading NZ Retail Financial
Services Company and Leveraging Group Competencies and Scale. The Board is
confident this strategic focus will deliver results for our shareholders."
"As our earnings are significantly influenced by Christmas trading
performance it is too early to provide specific earnings guidance. However,
the key elements of the Group's strategic plan should ensure adjusted NPAT in
FY15 is above that recorded in FY14" said Mr van Arkel".
The Directors have declared a final dividend of 6.0 cents per share which
will be paid on 11 December 2014 with the record date being 28 November 2014.
Total dividends for the year will be 19 cents per share as indicated in
March 2014.
ENDS
1 Certain transactions, which the Group defines as unusual can make the
comparisons of profits between years difficult. The Group monitors adjusted
net profit which removes unusual items as a key indicator of performance and
uses it as the basis for determining dividends and believe it helps improve
the understanding of underlying business performance. A reconciliation of
adjusted net profit to reported net profit is detailed on page (4) of the NZX
release and in note 14 of the Audited Financial Statements.
Background: The Warehouse Group Limited
The Warehouse Group Limited comprises 91 Warehouse stores, 77 Noel Leeming
stores and 63 Warehouse Stationery stores in New Zealand and several online
businesses. The company had turnover of $2.65 billion in FY14 and employs
over 10,000 people.
Contact details regarding this announcement:
Media, Investors and Analysts
Mark Powell, Group CEO
To be contacted via Gayle Theunissen on +64 9 489 8900, Extn 96333 or +64 21
742 784
End CA:00255148 For:WHS Type:FLLYR Time:2014-09-12 08:30:08
