Shares in Oroton Group (ORL) rose as much as 3% after the upmarket retailer reported a six month record net profit after tax of $10.4 million.
The company said the result is largely attributable to restructuring efforts undertaken in financial year 2007.
The result for the six months ended 26 January 2008, is up 70% from $6.1 million for the same period last year.
“The restructuring efforts are now flowing through to our bottom line, as expected, and the group is well placed with two healthy brands and a strong balance sheet,” chief executive officer Sally McDonald said.
However, the group said that in the event of a slowdown it is prepared for several contingencies, “but we remain cautiously optimistic due to the resilience of our two brands”.
“Our plans to invest in store upgrades across our network will continue into financial year 2009.”
Revenue from operating activities rose to $66.8 million from $62.3 million, an increase of 7.2%.
It also reported strong like for like retail sales increases of 17% in Polo Ralph Lauren and 12% in Oroton.
Ms McDonald said the clothing firm replaced some of its wholesale with retail sales and decreased factory sales as part of a “planned channel rationalisation and store programme.”
Oroton opened 8 new shop-in-shop retail concessions in Polo menswear in September 2007 – replacing 30 wholesale doors – and all are trading well.
“The Oroton flagship store in the Queen Victoria Building in Sydney also opened in December and is trading beyond expectations despite increased international competition in the same centre,” the group said.
Oroton declared a fully franked dividend of 15 cents, up from 6 cents in first half 2007. Record date is 9 April and payment date on 23 April 2008.
Shares in Oroton rose 8 cents or 2.6% to $3.12.
