Summary

  • In March quarter, total volume of retail sales declined by 0.7%
  • Grocery stores and supermarkets witnessed the biggest increase in sales during the quarter
  • WHS has started a consultation process

The retail industry is an important part of the New Zealand economy and has an impact on almost every New Zealander, every day. It is a market that is highly dynamic; constantly changing to meet consumer demand and has many competitive pressures. The industry is highly diverse, covering everything from the family grocer to high-end fashion, cars, fuel, and building supplies.

In the March quarter 2020, the total volume of retail sales decreased by 0.7 per cent as compared to December quarter (seasonally adjusted). The total value of retail sales decreased by 0.4 per cent or $89 million. 10 of the 16 regions indicated lower sales values.

Other key highlights:

  • Eight of the 15 industries had lower sales volumes in the March 2020 quarter
  • Motor vehicles and parts retailing had the largest fall, down 7.5 per cent after a flat December 2019 quarter

Key Data (Source: Stats NZ)

Let us have a look at some of the listed retailers of New Zealand.

Briscoe Group Limited (NZX: BGP)

Market Update and First Quarter Sales

For the first quarter ended 26th April 2020, the company reported total unaudited sales of $97.0 million, down by 35.6% than the same quarter last year. The company continued to provide a condensed range of essential items when there was Alert Level 4.

Previously, the Managing Director of the company, Rod Duke, decided to not to take any salary until the end of July 2020, and the senior management also decided to freeze their salary hike for the same period of time. The senior management as well as Board decided to make a temporary reduction in their fees and salaries by 20%, effective from the month of May 2020.

Stock Performance

The stock of BGP closed the day’s trading at NZ$3.110 per share on 19th June 2020, down by 1.58% on an intraday basis. The company has a market capitalisation of around $691.100 million and the stock’s 52-week low and high is $2.35 and $4.49, respectively. The stock has corrected 17.06% in the time period of six months.

The Warehouse Group Limited (NZX: WHS)

The company stated that it has started a consultation process as it adjusts to meet various customer needs by turning itself to an agile operating model. This process has been commenced at its Northcote head office.

  • Since moving to Level 2, the company has witnessed strong trading across its brands;
  • This level of trading is mainly witnessed due to pent up demand and is not expected to continue as the economic impacts of COVID-19 are realised;
  • However, considering the uncertainty around trading performance, the company confirms its position on withholding guidance on FY20 earnings.

For the third quarter ended 26th April 2020, the company reported unaudited retail sales of $586.3 million, down 17.9% compared to the same quarter last year. Retail Sales for the third quarter by brand are given below:

  • Warehouse Stationery registered sales of $64.5 million, down 9.8% on the same quarter last year;
  • Torpedo7 registered sales of $32.0 million, down 18.3% on the same quarter last year;
  • The Warehouse recorded sales of $297.3 million, down 23.0% on the same quarter last year;
  • Noel Leeming recorded sales of $193.5 million, down 10.9% on the same quarter last year.

Stock Performance

The stock of WHS closed the day’s trading at NZ$2.120 per share on 19th June 2020, up by 0.47% on June 19, 2020. The company has a market capitalisation of around $735.30 million and the stock’s 52-week low and high is $1.48 and $2.96, respectively. The stock price has corrected 25.87% in the time period of six months.

Kathmandu Holdings Limited (NZX: KMD)

Kathmandu Holdings Limited is a marketer, designer, wholesaler and retailer of footwear, clothing, and equipment for adventure and travel.

Strong Growth in Online Sales

During April, the online sales of the company saw huge growth and were 2.5 to 3 times higher as compared to the last year. Australian market, the company’s largest market, witnessed the higher growth rate.

Stock Performance

On June 19, 2020, the stock of KMD ended the session at NZ$1.240 per share, reflecting a rise of 5.08% on an intraday basis. The company has a market capitalisation of around $879.16 million as on June 19, 2020.

Michael Hill International Limited (NZX: MHJ)

The company has provided a business update across its market segments. As per the release dated May 14, 2020:

  • The company is gradually reopening its stores in all markets with safety protocols in place;
  • It has registered strong digital trading growth;
  • The company’s absolute focus is on cost reduction to eliminate non-essential expenditure and manage its cost of doing business (CODB).

Stock Performance

The stock of MHJ closed the day’s trading at NZ$0.380 per share on 19th June 2020, up by 2.70% on an intraday basis. The company has a market capitalisation of around $147.352 million and the stock’s 52-week low and high is $0.230 and $0.760, respectively. The stock price has corrected 44.92% in the time period of six months.

 

 


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