The Warehouse Group to repay $68 million wage subsidy

Source: 1News

An increase in sales means the Warehouse Group has become “confident” enough in its financial position to repay its nearly $68 million Covid-19 wage subsidy to the Government, the company announced this afternoon.

It comes as the company came under fire from unions earlier this year for proposing to slash as many as 750 people's jobs, equivalent to 320 full-time equivalent roles, a Warehouse spokesperson told 1 NEWS in September. The expected cuts totalled 12,800 hours per week from its staff rosters.

The Warehouse Group claimed $67.8 million as part of the wage subsidy for businesses affected by the economic hit of Covid-19 in April. 

“Sales performance to date has been well above expectation, and our financial position has remained strong, CEO Nick Grayston said.

“We are now in the position where the wage subsidy can be repaid in full.”

First quarter sales for the group are up 6.3 per cent. Now, that figure has been updated to being up 6.6 per cent for the year to date compared to the same period last year.

In October, the company announced on the NZX stock exchange its full-year profit was $44.5 million with the wage subsidy. Without it, the company would have made a $4.3 million loss.

In August, the Warehouse was accused of taking advantage of Auckland's lockdown to push through restructure plans that'll bring big job losses.

Workers at several branches were told of the decision to proceed with the restructure in September.

At the time, First Union said it wouldn't know the final number of jobs affected or the hours reduced until the company's restructuring process was finished.

But, the union said "the plan will disadvantage thousands of workers".

In March, the Warehouse declared they would remain open during the Alert Level 4 Covid-19 lockdown. But, the retailer was not deemed essential, and it was shut during the lockdown period. 

Shares of The Warehouse went up 35 per cent on the morning when it was thought the retailer would remain open.

The group includes The Warehouse, The Warehouse Stationery, Noel Leeming and Torpedo 7.