SYDNEY, AAP – Super Retail Group has had first-half profit dive 35 per cent and warns higher freight and transport costs will continue to affect margins.
The company behind BCF, Macpac, Rebel and Supercheap Auto said COVID-19 lockdowns and higher costs contributed to a lower net profit after tax of $110.8 million for the six months to December 25.
Sales were down four per cent to $1.7 billion.
The second-half of the financial year has started much better. BCF and Supercheap Auto have fared best and helped group sales improve six per cent.
However an ongoing concern for investors is the higher cost of trading.
The transport costs, more regular promotional costs and growth in home delivery cut profit margins.
Many companies have had higher costs to import goods after people around the world caused an international logjam by ordering more goods and less services during the pandemic.
Super Retail warned some of this effect would continue in the second half of its financial year.
“While cost escalation associated with global supply chain disruption is expected to moderate over time, it will impact gross margin in the second half,” the company said.
Super Retail also during its first-half ended some pandemic cost-saving measures.
Staff wages had also been higher due to retaining employees during lockdowns.
Investors will receive a fully franked interim dividend of 27 cents per share. This is lower than the 33 cents per share paid this time last year.
Sports chain Rebel and Supercheap Auto are the biggest of the Super Retail Group businesses in terms of sales. Each reaped more than $600 million during the first half.
Supercheap Auto founder Reginald Rowe continues to have the biggest stake in the company, about 30 per cent of shares.
Shares in the company were down eight per cent to $11.75 at 1550 AEDT.