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FURNITURE retailer Nick Scali Limited (ASX:NCK) has recorded $20.5 million profit for the half year to December 31, up 44.7 per cent on the same period the previous year.
Sales revenue is up 15.5 per cent to $118.4 million at the Sydney-based company, while same store sales growth was 10.1 per cent.
Gross margins strengthened to 62 per cent, largely because of the increased sales volumes reaching new economies of scale, particularly in specialised categories.
Operating expenses as a percentage of sales decreased to 36.4 per cent, compared to 39.5 per cent the previous corresponding period.
Managing director, Anthony Scali, says the company's overall performance has been underpinned by the current favourable market conditions, our continued store rollout program and economies of scale.
"The store rollout to strategically selected locations will continue to be a major element of our strategy," says Scali.
There will be a full-franked dividend of $0.14 per share, with a record date of 1 March, 2017 payable on 22 March.
This compares to a $0.09 per share dividend the previous corresponding period.
Three new Nick Scali Furniture stores opened in the second half, in Hobart (first store in Tasmania), Geelong (Vic), and Jandakot (WA), bringing the total number of stores to 50.
A further two to three stores are expected to open during the second half of the 2017 financial year and there is a promising pipeline of new stores for financial year 2018.
January is traditionally the company's biggest trading month for sales orders received and the four-week trading period in January 2017 saw continued double digit growth in both total sales orders and comparative stores sales orders compared with the previous corresponding period.
The company expects market conditions to remain favourable in the second half.
Nick Scali finished today's trading on the ASX up 9.64 per cent on the previous day's close, at $7.05 per share.
Business News Australia
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