Nick Scali (NCK) H2 2024 earnings summary

Executive summary

• ANZ written sales orders reached AUD 447.4 million, up 2.4% year-over-year, with group written sales orders at AUD 454.2 million, up 3.9% year-over-year.

• Group underlying profit after tax (excluding acquisition costs) was AUD 82.1 million, down 18.8% year-over-year.

• Group revenue was AUD 468.2 million, down 7.8% compared to FY23, reflecting normalization after prior year delivery backlog.

• UK acquisition of Fabb Furniture completed in May 2024, with results included from acquisition date.

• Cash and bank deposits at June 30 were AUD 111.3 million.

Financial highlights

• ANZ gross margin improved to 66.0%, up 2.5% year-over-year.

• Group gross margin was 65.5%; UK gross margin at 41.5%-42.0%.

• Underlying EBITDA was AUD 175.0 million and EBIT AUD 129.5 million, both lower than FY23.

• Final dividend of AUD 0.33 per share, fully franked, bringing full year dividends to AUD 0.68 per share.

• Property and capital investments totaled AUD 28.1 million, including AUD 16.6 million for a new distribution center.

Outlook and guidance

• Store network expansion planned: 2 Nick Scali stores and 3-5 Plush stores expected to open in FY25.

• Written sales growth for June and July combined was -1.2% year-over-year, with New Zealand notably weak.

• UK trading expected to deteriorate in 1H FY25 due to store refurbishments, product range changes, and supply chain disruptions.