The sale of Torpedo7 has helped contribute to a $23.7m half-year loss for the Warehouse Group, with sales at The Warehouse, Warehouse Stationery and Noel Leeming all down.
Last month The Warehouse Group announced it had sold the outdoor brand Torpedo7 for $1 to Tahua Partners Limited, and said at the time it would result in a write-down on its FY24 half-year results.
The Warehouse Group chief executive Nick Grayston said it had posted a net loss after tax of $23.7m, and the overall result, which saw total sales of $1.633b - down 4.9% compared to the first half of FY23 - was sobering.
"The sale of Torpedo7 has had a severe impact on the Group's financial performance this half. While the disposal of Torpedo7 means we have incurred significant write-downs, it allows us to redirect our focus towards our core brands and build on the $30.7 million in Adjusted NPAT from our continuing operations.
"As a further part of our strategic reset, we intend to sell or close TheMarket.com by the end of the financial year. We are re-directing our focus and learnings into growing Group Marketplace on The Warehouse site and app, where we are now seeing improved profitability."
The reduction in overall sales was driven by a decline on online sales as it focused on profitable performance.
"If we remove the impact of store changes year-on-year and exclude online, sales were only down 1.4% compared to our last half year.
"Consumer spending across the New Zealand economy remains subdued, with the impacts of inflation, higher interest rates, and increased living costs on customers’ household budgets impacting discretionary spending."
Sales at The Warehouse ($965.6m) were down 4.7% on the first half of FY23.
"Grocery continued to grow with sales up 11.7% and making up 20.2% of The Warehouse sales. In particular, pantry sales were up 31.4% and chilled and frozen sales were up 20%," Grayston said.
Warehouse Stationery sales ($117.9m) were down 5% and Noel Leeming ($544.4m) 2.2%.
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