Outdoors and automotive parts and products retailer Super Retail Group (ASX: SUL) saw a noticeable improvement in sales performance in the March quarter after being whacked in the first three months of the 2021-22 financial year by the Covid lockdowns, especially in NSW and Victoria.
Super Cheap told the ASX on Tuesday that it had started 2022 on a positive note, growing sales 4.4% for three months to March on a like for like basis with the improvement continuing past the end of the quarter and through the Easter holiday period in April.
Super Retail’s group sales for the six months to December 31 down 4.8% (on a like for like basis) but the March quarter rise saw the year-to-date performance trimmed to a drop of just 1.3%. That is a lot better than the large double digital fall experienced in the three months to September.
Comparable sales at the core chain Supercheap Auto rose 8.4% for the period and 7.6% at camping store BCF, with both benefitting from high stock availability and strong consumer demand, the company told the ASX and the Sydney investment conference of Macquarie.
BCF has probably been the best performing chain in the Super Cheap group so far in 2021-22 – the strong third quarter performance saw the 2.4% fall in the first half become a rise of 1.4% by the end of the quarter.
However, sales at Rebel sports went backwards by 1.8% in the March quarter (although that saw the year-to-date sales loss slow to a fall of 4% from 5.2% at the halfway mark). Sales at outdoor apparel retailer Macpac grew just 1.2% which trimmed the 0.4% sales growth at the halfway point to 0.3% by the end of the third quarter.
“Trading in Rebel has benefitted from an uplift in foot traffic in shopping malls but has been impacted by limited stock availability in some categories, especially footwear, due to global supply chain disruption,” CEO, Anthony Heraghty said in the statement which was issued as the company updated the investment conference in Sydney.
“Macpac has inventory in place for the key winter trading period and expects to benefit from the reopening of international travel.
“Super Retail Group’s margins for the quarter stayed broadly in line with its margins through the first half, which saw the group report underlying profits of $111 million.
“Given ongoing disruptions to the global supply chain, the group is continuing to adopt a cautious approach to managing its inventory position to ensure it has appropriate levels of ‘safety stock’ in place,” Mr Heraghty said.
Curiously the trading update didn’t mention the company’s online sales performance which has been a strong point during the pandemic and part of the company’s strategy of selling to as many people through as many channels (‘omni-channel is the jargon’).
The December half year report noted that the company enjoyed “record online sales – digital sales up 64 per cent to $389 million” for the half.
The presentation to the conference used the December half year figure, but none for the latest period mentioned in Tuesday’s update.
Super Group shares fell 2% to $10.24, an odd reaction given the size of the bounce back.
…………
A stronger performance from digital real estate group Domain Holdings (ASX: DHG) – which is nearly 50%-controlled by Nine Entertainment – in the March quarter saw its shares rise 3.2% to $3.53.
Domain said in the update that the March 31 quarter had seen a 25% increase in digital revenue and a 24% improvement in total revenue.
The company said it was making more revenue from the residential sector.
“The results of Domain’s transformation to date underpin our confidence to continue to invest in our Marketplace strategy, while retaining our disciplined investment approach, and commitment to ongoing margin expansion,” the company told the conference and the market.
Domain said its 2021-22 cost guidance “is unchanged from the update provided with our half year results in February 2022, with expenses expected to increase in the low-teens range from the FY21 ongoing expense base of $195.5 million.”
“This excludes the impact of the JobKeeper and Zipline expenses which are included in FY22 H1 trading expenses,” the company said.
That news on costs did more than anything to lift the share price.
