Super Retail Group revs up as profit triples

Super Retail Group revs up as profit triples

The Brisbane-based retail group that owns Supercheap Auto, rebel, Macpac and BCF is fishing a big haul after a frenzied sales period in the December half that lifted revenue by 23 per cent.

Provisional financial results released today show Super Retail Group (ASX: SUL) will likely see its net profit after tax (NPAT) rise by 196-201 per cent to $170-173 million.

Just a month out from his two-year anniversary as CEO, Anthony Heraghty has thanked the "outstanding efforts" of his team who adapted to the unique challenges posed by COVID-19, and highlighted an "instrumental" contribution from an omni-channel strategy.

Online sales rose 87 per cent in the six months to 26 December, reaching $237 million. This represents around 13.3 per cent of total sales.

"Since our last update to the market in October, the Group has continued to perform well. We are particularly pleased with our record online sales over the November cyber weekend and strong Christmas trading," says Heraghty.

"This has culminated in a record first half performance for the Group.

"The operating leverage which the Group has been able to achieve during a period of robust online sales growth clearly reinforces the profitability of our digital sales and, in particular, the scalability of our omni-retail platform."

He highlights strong cashflow generation leaves Super Retail Group well placed in the second half to reinvest in its brands, in order to maintain its customer value proposition, expand and reward its customer base, and grow market share.

"As inventory levels are restored during the second half, following a period of unprecedented consumer demand, we expect the level of promotional activity to increase," he says.

"While we remain cautious on the outlook for the second half given the uncertain economic environment, the Group has a resilient business model, underpinned by powerful brands with market-leading positions in growing lifestyle categories, an active customer base of 7.1 million loyalty club members and a conservative balance sheet with a strong cash balance and no net bank debt.

"We look forward to updating the market further at our half yearly results announcement on 17 February."

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