The Warehouse posts record profit of $117.7m

Author
Rahul Bhattarai, NZ Herald,
Publish Date
Wed, 29 Sep 2021, 10:51AM
(Photo / NZ Herald)
(Photo / NZ Herald)

The Warehouse posts record profit of $117.7m

Author
Rahul Bhattarai, NZ Herald,
Publish Date
Wed, 29 Sep 2021, 10:51AM

The Warehouse has posted a record net profit for 2021 with total sales up 7.6 per cent to $3.4 billion as customers took to online shopping and splurged after Covid lockdowns.

The nationwide retailer reported statutory net profit of $117.7m in the year to August 1, 2021, up 164 per cent on the previous year's $44.5m.

Adjusted net profit - after excluding $67.6m wage subsidy repayments and $16.1m of restructuring expenses - came in at $175.5m – up from $32.1m the prior year.

Total online sales were up 5 per cent to $393.1m and now make up 11.5 per cent of total group sales.

The Warehouse declared a final dividend of 17.5c a share, taking the total dividend to 35.5c a share, including a special 5c payout declared in February.

The company, which owns The Warehouse, Warehouse Stationery, Noel Leeming, Torpedo 7 and TheMarket.co.nz, said operating profit was $240.6m, up 388.5 per cent or 49.3m from last year.

Chair Joan Withers said the year-end results exceeded expectations.

"Pent-up demand after lockdowns, strong operational performance and a robust financial position enabled the Group to repay the Covid-19 wage subsidy of $67.6m for our 11,000 employees in December 2020," said Withers.

The board declared the final dividend on the assumption that New Zealand is predominantly at level 2 from the end of October.

Group chief executive Nick Grayston said he was proud of the FY21 outcome, particularly the way his team worked during the 28.5 days of Auckland lockdowns last August and in February and March this year.

"Full year 2021 has given us further confidence that our customer-led strategy is the right one," Grayston said.

"We are seeing the benefits of our transformation programme and we are part way through significant digital investment to improve legacy systems and set ourselves up to give our teams and customers an even better experience.

"Our culture and mindset and our teams' expertise have enabled the business to react swiftly in response to Covid-19 alert level changes, including the closing and reopening of stores and the move to click & collect almost overnight.

"The same is true of this most recent lockdown period which has occurred post year-end, and we thank our team members for their significant contributions during challenging times," he said.

This year the Warehouse introduced a new "mobile-first" eCommerce platform, which would be rolled out to the other brands for FY22.

"The change will make our mobile apps and websites easier to use for our customers while providing for greater performance and innovation from our team. This investment allowed us to be able to pivot quickly to the requirement to trade essentials and non-essentials in split lockdown levels within the current restrictions.

"We are in the process of upgrading our Enterprise Resource Planning system for finance and inventory which will further enable the ability for our customers to shop seamlessly across our brands and channels," Grayston said.