Baby Bunting shares jumped sharply yesterday after the company upgraded its earnings outlook for the current half.
The shares jumped 22% in early trading but eased a little to end the session up 10.8% at $2.20.
The baby goods retailer reported total sales growth of 17% for the 20 weeks to November 15, with like-for-like sales (which removes the impact of opening a new store) up a solid 9.6%.
“What we have experienced has been unprecedented,” CEO Matt Spencer told the company’s annual general meeting on Monday.
“After around 20 weeks of trading, Baby Bunting now forecasts that pro forma EBITDA for FY19 will be in the range of $25 million to $27 million, excluding employee equity expenses. This represents growth of between around 34% and around 45%, “ the company told the ASX.
“Comparable store sales for the first 20 weeks (up to 15 November 2018) have been 9.6%. Total sales have increased by 17% relative to the prior comparable period. There has been positive gross margin improvement and Baby Bunting is on track to achieve guidance of gross margins exceeding 34% for the year.
“Baby Bunting anticipates opening a further two new stores prior to Christmas, bringing the store network to 52 stores: at Chadstone, Baby Bunting’s first shopping center format store and at Bankstown in a former Toys R Us / Babies R Us location. Plans are also progressing for a store at Shellharbour near Wollongong, which would be the sixth new store for FY19,” the company said yesterday.
