7 Nov 2014

Warehouse Group reports solid quarter

2:21 pm on 7 November 2014

The Warehouse Group says all its store brands returned solid sales in its first quarter, resulting in a 3.4 percent increase overall.

Sales totalled $589.4 million in the three months ended late October, up from $569.8 million in the same three months last year.

Sales through the company's traditional Red Sheds rose 1.3 percent in the quarter, accounting for 61 percent of the total.

The biggest gainer was Torpedo7, whose sales jumped 49.4 percent.

Warehouse Group chief executive Mark Powell said the quarter saw improved gross margins at the Red Shed stores, but the rebranding of Torpedo7 and Noel Leeming meant higher costs.

He said it was quite a different quarter for each of the brands.

"For The Warehouse last year we had a very strong sales growth but poor margin performance. This year, even though it was a difficult winter, we grew margin reasonably strongly because we've managed the winter exit a lot better.

"Warehouse Stationary was up against their re-branding last year but still managed to achieve growth.

"And Noel Leeming, last year there was particular activity in the technology and audio-visual market due to the digital switchover for televisions. They were cycling against that but they gained market share and got growth in what has been a declining market in the first quarter."

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