Investors were encouraged by the performance of Nick Scali (ASX: NCK) today as shares in the furniture retailer pushed 8 per cent higher, with managing director Anthony Scali describing the record result as "satisfactory".
The group notched its seventh straight year of record profit, up 2.8 per cent year-on-year at $42.1 million.
Sales revenue increased almost 7 per cent to $268 million bolstered by a full year's contribution from the stores opened during FY18 and varying contributions from the six stores opened during FY19.
Same store sales however were down 1 per cent for the year, but new product initiatives helped strengthen gross margins despite currency headwinds.
"The result was satisfactory given that furniture purchases are highly discretionary and have a strong correlation with housing sales," Scali said.
"In the past twelve months, Australia has experienced a significant slowdown in dwelling sales and the consumer has seen the value of their homes fall with the negative wealth affect resulting in a very cautious consumer."
The company observed flat same store sales towards the end of the financial year and in July they were negative.
On a more positive note, the retailer said the performance of New Zealand stores as been very encouraging with strong same store sales growth reflecting the high level of product and brand acceptance.Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
Business News Australia
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