Glue Store, Subtype and Platypus owner Accent Group posts record half year profit

Glue Store, Subtype and Platypus owner Accent Group posts record half year profit

The company behind popular retail outlets Subtype, Platypus, Glue Store, HYPE and more has today reported a record $58.3 million profit for the first half of the financial year, driven by a sharp increase in e-commerce sales.

Accent Group (ASX: AX1) saw total sales increase by 39 per cent in the period, but it was e-commerce that really made an impact on profitability - growing by 160 per cent to $134 million compared to FY20 and contributing 18.9 per cent of total retail sales.

E-commerce sales were lower than achieved in 1H22, but the company attributed success in that period to the impact of lockdowns and COVID-19 restrictions which drove customers to its digital stores instead of bricks-and-mortar.

Earnings also rose by 70.9 per cent to $170.2 million and profit almost quadrupled, leading to Accent Group delivering shareholders an interim dividend of 12 cents per share.

Accent Group CEO Daniel Agostinelli said he was “delighted’ with the first half results.

“I am delighted with the results achieved in H1 FY23. The continued focus on customers, new product, full margin sales and return on investment has delivered a terrific H1 result,” Agostinelli said.

“What is most pleasing is the strength and consistency of performance across our large core banners, including Skechers, Platypus, Hype DC, The Athlete’s Foot (TAF), Vans and Dr Martens, along with the progress that we have made in our new banners now that trading conditions have normalised.”

During the half, Accent opened 53 new stores, transitioned 13 stores from discontinued into continuing brands and closed 10 stores where rent outcomes could not be achieved. The company closed the half year with 805 stores in total.

The roll-out of new stores will continue in the second half, with plans to open at least 20 new outlets ongoing.

Accent Group said supply chain impacts had normalised, with strong deliveries of new release products supporting sales growth.

In the first seven weeks of the second half, Accent Group said like-for-like sales were up 16 per cent on the prior year. Agostinelli was optimistic about this trend, but noted current economic conditions gave him pause.

“Whilst we recognise that there is some uncertainty in the economic outlook, to this point we have not yet seen any significant change to consumer spending in our categories. Many of our brands target a younger customer demographic who tend to be less impacted by interest rates and cost of living pressures,” Agostinelli said.

“In conclusion, I am pleased with the ongoing progress that has been made on our key growth strategies as we continue to build a strong, defensible business in Australia and New Zealand.

“Our portfolio of global distributed brands, owned vertical brands, integrated digital capability and large store network are core assets of the group and position the company well for growth into the future.”

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