IN-STORE VETS BOOST GREENCROSS' PROFIT
Written on the 21 February 2017 by Business News Australia
GREENCROSS Limited (ASX: GXL) shares lifted 5 per cent in trading today after the Brisbane-based company posted a net profit of $21.9 million, beating its previous interim result by 17 per cent.
The veterinarian and pet goods giant increased its revenue by 14 per cent to $412.3 million, a result reflected in the company's successful launch of 16 new stores during the half-year.
Greencross, the company responsible for subsidiaries including Petbarn and City Farmers, also recently celebrated the launch of its 200th Australian retail store in Sydney's Neutral bay.
CEO of Greencross Martin Nicholas (pictured) says the interim report is an indication of strong performance across both the company's retail and veterinary divisions, and a precursor to the next phase of expansion.
"We had a good Christmas with strong growth in services revenue and record sales in our core dog and cat food categories driving 4.0 per cent group retail LFL sales growth," says Nicholas.
"We remain confident we can meet our long-term target of 350 stores in Australia and New Zealand.
"I am particularly delighted with our veterinary division which achieved industry leading 5.3 per cent LFL sales growth driven by the rapid ramp up in visits to our in-store clinics and continued cross referrals from our retail stores."
According to Nicholas the vet sector "continues to attract significant amounts of capital globally" and Greencross' in-store clinic assets are in a strong position to capitalise on this trend.
Likewise, the company will continue to keep its finger on the pulse of potential merger and acquisition opportunities.
"We have now opened 25 in-store clinics and a significant organic growth runway lies ahead with clear sight to over 120 in-store clinics," he says.
"We also remain vigilant in the acquisition market and will pursue quality veterinary practices in a disciplined manner."
The ASX responded well to Greencross' interim report as company shares jumped 5.2 per cent on opening to currently trade at $6.98.
Greencross has declared an interim dividend at 9.5c per share to be paid on 24 March with an option for reinvestment.
Author: Business News Australia