Smiths City boosts interim profit
Smiths City Group has posted a $1.9 million profit for the half-year, almost 13 per cent up on the previous half-year.
The Christchurch-based department store chain confirmed aims to enter the Auckland market and that it was seeking an acquisition in the furniture industry.
The group's 47 stores sell home furnishings, bedding, whiteware, electronic appliances and other home goods.
The company declared an untaxed interim dividend of 1 cent a share, to be paid on February 14. Earnings a share were 3.61c, compared with 3.2c in the previous half-year.
The company said that in the half-year to the end of October, management had concentrated on increasing sales in the profitable lines, predominantly furniture, kitchen appliances and bedding, and reducing costs and completing the restructure of Smith City Wellington.
It said the appliance market continued to face tough times, particularly consumer electronics, where a 32-inch television set was advertised at only $399 and a 50-inch set at $699.
The company was making strong gains in flooring, whiteware and bedding.
Revenue for the six months was $108.5m, 1.1 per cent down on the previous first half.
Chairman Craig Boyce said trading remained competitive, with prices under pressure, particularly in consumer electronics. Margins were being squeezed and property costs such as insurance were rising.
The increase in profit was the result of the company managing the conditions effectively and seeing the benefits of restructured financing arrangements, he said.
In Christchurch, where the rebuild was slower than expected, the company's competitors had reopened.
Sales in rural South Island had been strong, Wellington was improving and sales in the upper North island were flat.