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SUPER Retail Group (ASX: SUL) has experienced a 25 per cent full year profit slide attributable to restructuring and the closure of one of its businesses.
The company behind the Supercheap Auto, Rebel Sport and BCF chains made a net profit of $81.1 million for the year to June 30, down from $108.4 million a year ago.
It incurred $12.8 million in costs associated with the restructuring of Ray's Outdoors and Workout World and a $16.2 million loss associated with the discontinued Fishing Camping Outdoors (FCO) business in New Zealand.
Super Retail managing director and CEO, Peter Birtles (pictured), says the overall result was strong considering weaker performance and restructuring costs.
He also pinpoints the company's leisure and auto retailing divisions performing well in light of the 'weaker economy in its home state of Queensland'.
"The Auto and Sports Retailing divisions experienced strong like for like sales growth during the year, underperforming businesses were restructured or closed as part of a strategic review to drive long term growth, and we continued to advance our multi-channel capabilities," says Birtles.
"While the restructuring and discontinuation of underperforming businesses, as well as the ongoing investment in our supply chain and systems, impacted our financial results for the period, these initiatives will underpin the Group's future profit growth and competitiveness, and support the realisation of our multi-channel retailer strategy."
The group intends to open another 20 to 30 stores over the next year, but Birtles adds that high exposure to the Queensland economy may continue providing for modest sales growth.
"We expect overall retail growth in our markets to be modest given patchy consumer confidence and our higher exposure to the Queensland economy, but we expect to achieve solid like for like sales growth driven by market share growth in all businesses," he says.
SUL's share price is at $9.66 on the ASX today, unchanged from yesterday.
The company will pay a final fully franked dividend of 21.5c on October 2. Combined with the interim dividend of 18.5c, Super Retail's full year dividend comes to 40c per share.
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