A WELL-planned and executed half has paid off for Super Retail Group (ASX:SUL) as it posts a net profit result up 26.3 per cent at $74.4 million, normalised to account for brand name impairment incurred during 1H16.
Revenue increased by 6.6 per cent, hitting almost $1.3 billion, to take the group's earnings before interest and tax (EBIT) result to $115.2 million, up 23.7 per cent.
The Group's auto and sports divisions, comprised of SuperCheap Auto, Amart Sports and Rebel brands, were the core drivers of 1H16's success. The two divisions increased segment EBIT margins by 10.1 per cent and 19.5 per cent respectively.
The smaller leisure division, comprised of BCF and Rays brands, also performed well to achieve total EBIT of $20.6 million, up 53.7 per cent.
Super Retail Group managing director and CEO Peter Birtles (pictured) says he is pleased with the company's return to generating robust underlying earnings growth.
"These results build on the momentum that we established in the second half of the 2016 financial year," says Birtles.
"We continue to make good progress on the key initiatives outlined in the plan we implemented in May 2015 to lift both compound annual earnings per share growth and return on capital back above 15 per cent."
The group opened 12 new stores across the network in the last half, taking the total number of stores to 641. It also expects to launch a further 12 stores in the second half.
Birtles is confident that Super Retail Group will continue to build sales growth before the full year is out.
"We are confident that we will be able to deliver continued sales growth across all brands, with improvements in profitability driven by investment in new and refurbished stores, omni retail capabilities and supply chain and operating model efficiencies," says Birtles.
The group's positive results are reflected in its share price, which is currently up more than 6.3 per cent at $10.39 on the ASX.
Super Retail Group has declared an interim dividend of 21.5c payable on 7 April.
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