Back to school boosts The Warehouse Group sales
The Warehouse Group's tills rang up more than $635 million in sales in the last three months as students went back to school.
The group owns big box retail brands The Warehouse, Warehouse Stationery, Noel Leeming and adventure sports chain Torpedo 7.
Collectively the brands ranked up sales totalling $635.1m in the three months to April 26, up $30.3m compared to the same time last year.
Forsyth Barr analyst Chelsea Leadbetter said the performance exceeded expectations but "only very modestly".
"It's a pretty reasonable outcome and pretty solid quarter from them," she said.
Retailers were generally struggling with low sales growth. The group's performance in the last three months of the financial year would depend on any factors slowing the economy, which could include falling dairy prices, Leadbetter said.
The Warehouse contributed more than half the total sales with $381.1m, up 3.8 per cent, the company said in a market update on Friday
Group chief executive Mark Powell said strong sales at The Warehouse during the back to school period and in the home, apparel and leisure categories helped drive the growth.
The stores also made good progress on extending digital and multi-channel sales capability with the "Click & Collect" service, allowing customers to order online and pick up in store, and an extended range of products available online.
Revenue from online sales grew at higher rates than the market, he said.
The third quarter "saw a much improved performance on a challenging first half" of the financial year.
Sales at Warehouse Stationery were up 2.9 per cent to $70.2m.
The rebranding of consumer electronics chain Noel Leeming and opening of new stores had driven a 5.4 per cent increase in sales to $154.8m, but this growth was a more modest 0.9 per cent when the new stores were excluded.
After a tough first half of the financial year, following a boost from television sales during the digital switch-over period the the previous year, Noel Leeming had rebounded well in the third quarter and continued to gain market share, Powell said.
Sports retailer Torpedo7's sales were up 8.5 per cent to $30.6m.
"Torpedo7 Group is still in its early stages of development and continues to work on the strategic direction of becoming NZ's leading outdoor, adventure sport omni-channel retailer," Powell said.
"The retail environment continues to be highly competitive and our focus remains on leveraging year-on-year profit growth for the second half year."
The full-year adjusted profit after tax was expected to be in line with previous guidance of between $52m and $56m, or 14 per cent to 18 per cent lower than last year, he said.