Supercheap Auto and the Rebel/Amart Sports owner Super Retail Group had an odd complaint yesterday – the company told the annual meeting in Brisbane that says sales growth has been slightly dampened by soft consumer spending.
The meeting was told that in the 16 weeks to October 21, topline sales in the group’s auto division rose 6%, while camping and leisure business BCF lifted sales 7% and the sports retail division saw a 5% rise.
On the more accurate like-for-like sales were 4% for auto, while leisure and sports each had 2% like-for-like growth, the company said in a trading update to its annual meeting.
Those sort of figures would have been a boom if they had come from the likes of the struggling Myer or Speciality Fashion Group for instance. With retail sales sluggish in the September quarter (sales fell 0.6% overall in August), Supercheap’s chains have done more than OK.
But investors sent the shares lower by 1.3% yesterday to a close of $8.08 as the wider market weakened in afternoon trading.
Super Retail CEO Peter Birtles says the growth was in line with the company’s expectations.
“Although like-for-like sales growth has been slightly dampened by the subdued consumer environment, we continue to generate sourcing and supply chain efficiencies and are maintaining strong operating cost control across the group,” he said in yesterday’s trading update.
He said Supercheap Auto continued to perform strongly with growth in all categories and in most of its Australian and New Zealand stores.
“We have made a positive start to the year with the businesses delivering profitable growth in line with our budget expectations. Although like for like sales growth has been slightly dampened by the subdued consumer environment, we continue to generate sourcing and supply chain efficiencies and are maintaining strong operating cost control across the Group.
“Sales performance in Supercheap Auto has been pleasing, achieving growth in all categories and most Australian states and New Zealand. The business continues to build operating margins through fine tuning its promotional activities, as well as through sourcing and supply chain initiatives.
The sports division, which is merging the Amart Sports business under the Rebel brand, delivered solid sales but BCF’s like-for-like sales were slightly below the group’s expectations.
The conversion of Amart Sports stores into Rebel is almost complete with only six stores yet to be converted, with those locations on track to be rebranded by the end of this month.
Super Retail says it still plans to open up to 10 new Supercheap stores this year, as well as refurbishing up to 44, opening three new BCF stores, one new Rays store and three new Rebel stores.
“Our store development, refurbishment program and Amart Sports store conversions to Rebel will be a major component of our capital expenditure plans for the year which are expected to be around $120 million,” Mr Birtles said in the update.
