Accent Group Limited (ASX:AX1) charged up on ASX after FY21 trading update

  • November 20, 2020 12:56 PM AEDT
  • Kunal Sawhney
    CEO Kunal Sawhney
    2781 Posts

    Kunal Sawhney is founder & CEO at Kalkine and is a richly experienced and accomplished financial professional with a wealth of knowledge in the Australian Equities Market. Kunal obtained a Master of Business Administration degree from University of T...

Accent Group Limited (ASX:AX1) charged up on ASX after FY21 trading update

 

Summary

  • Accent Group Limited (ASX:AX1) clocked 15.7% higher like for like sales in the first 20 weeks of FY21, excluding Auckland and Victorian stores.
  • Due to estimated damage of $39 million to the sales amid store closures in Victoria and Auckland, the net like for like sales increased by 1.3%
  • The digital sales for the company have improved by an impressive 129% as customers transitioned to the online stores.
  • The company is well on track to open up 80 new retail stores, and has opened its first Australian Stylerunner store in Armadale, Victoria. Three Pivot stores (two in Victoria and one in New South Wales) have also been opened.
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On 20th November 2020, the footwear retailer Accent Group Limited (ASX: AX1) announced its trading update for the first 20 weeks of FY21. According to the update, the company clocked 15.7% higher like for like sales, excluding Auckland and Victorian stores.

Due to the store closures in Victoria and Auckland, an estimated $39 million of impact on sales has been incurred compared to the previous year. After accounting for the damage, the total like for like sales so far for FY21 has increased by 1.3%.

The digital sales for the company have improved by an impressive 129% as customers transitioned to online stores during the store closures in the pandemic. Some of the most popular Accent banners driving the sales are The Athlete’s Foot, The Trybe, Skechers, Platypus, to name a few.

The physical stores in Victoria have been re-opened since October and are flooded by the customers now. The recent lockdown in Adelaide amid the discovery of a new cluster of Covid19 positive patients might dent the sales again. However, the company is confident about its significant store footprint and its’ capability to pivot to online sales, which already has been demonstrated during the first 20 weeks of FY21.

The company continues to flourish in other states of Australia and in New Zealand. It is also sticking to its employee-centric policies; all the permanent employees of the company in Adelaide would receive their full pay. They will also be paid duly for the committed shifts for the initial lockdown period.

ALSO READ: ASX Retail companies set to embrace softer restrictions in Victoria

New stores openings

The company is well on track to open up 80 new retail stores, including some with new concepts in FY21. The company has opened its first Australian Stylerunner store in Armadale, Victoria and has already clocked more than expected sales so far. Another three stores are also in the pipeline to be opened.

Three Pivot stores have also been opened in, two of them in Victoria (Highpoint and Ballarat) and one in Shellharbour, New South Wales. All stores are doing well and beating the company’s expectations. The store opening in 15 more locations would be materialised by the end of FY21.

Mr Daniel Agostinelli, CEO of Accent Group, is also delighted with the strong sales and store openings and has shown confidence in well-prepared plans to capitalise on the crucial November cyber events, back to school trading periods and Christmas.

The confidence has come after the resilient performance by the company during the lockdown through its integrated omnichannel model.

Stock Performance

Accent’s shares are trading up by 6.4%, at A$1.895 mid-day. Today’s session also posted the new high of A$1.89 for the current month and is close to October’s high of A$1.92. The consistent recovery from the 52-week low of A$0.55 in March has led to a return of more than 200%.

 

 


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