Women's fashion chains lift profit
The owner of fashion chains Just Jeans, Jacqui E and Portmans in New Zealand has increased annual profit more than six-fold, despite a sales slip off.
In results just posted with the Companies Office here, Kimbyr Investments - which also includes Jay Jays, Dotti, pyjama retailer Peter Alexander and stationery chain Smiggle - said profit for the year ending July 28 2012 was $4.5m.
That was up 654 per cent on the prior year, although the large jump was off a low base and due to a $3.3m strategic review charge and higher expenses weighing on earnings in 2011.
Revenue for the year ending July 2012 fell seven per cent to $134.7m.
Retailers have been doing it tough for several years, with recession-wary New Zealanders choosing to pay down debt and becoming heavily sales-focused to get maximum value from their discretionary spending.
But latest retail figures and reports from Just Group rivals such as Country Road and Hallenstein Glasson indicate consumers here are increasingly confident and willing to spend.
Premier Investments, the parent company of Kimbyr Investments, said in September that annual underlying earnings before interest, tax, depreciation and amortisation for the group of retailers across Australia, New Zealand and Singapore was A$80.4m - up 23 per cent year-on-year.
It said online sales growth had been exceptional - up 67 per cent, while sales at its younger, "innovative" brands Peter Alexander and Smiggle were up 17 and 14 per cent respectively.
The company is working to "rejuvenate" it's core retail brands - Just Jeans, Portmans, Jacqui E, Dotti and Jay Jays - which all recorded annual sales declines.
Worst hit were Jacqui E, where sales fell 16 per cent to A$68m, and Jay Jays - down 13 per cent to A$188m.
Premier said it would continue to close loss-making stores in those two chains as their leases expired. It closed 25 loss-making stores across Australia and New Zealand in the year, negotiated more favourable leasing terms and lower rents for its stores, and rejigged rosters to reflect the fact that 70 per cent of shopping occurred over Thursday to Sunday.
In New Zealand it closed just two Christchurch stores - a Jay Jays store in Shirley and a Just Jeans store in Hornby. It opened one Peter Alexander store, and one Smiggle store.
Kimbyr's results show New Zealand employee expenses for the year fell 8.3 per cent to $20.6m.
Premier has 165 stores in New Zealand in total.
The company said it planned to expand the Smiggle chain - which targets females between five and 19 years old - into Malaysia and Japan this year, and into China and Korea after that.
It also plans to open between 20 and 30 new Peter Alexander stores in New Zealand and Australia per year over the next three years.
Premier chairman and Australian retail billionaire Solomon Lew said in December its all-important summer selling season had begun well, but it was too early to predict how its half-year sales would go.