Super Retail Group (SUL) H1 2025 earnings summary

Executive summary

• Revenue grew 4% year-over-year to $2.1 billion, with like-for-like sales up 1.8% amid a challenging retail environment and heightened competition, especially in New Zealand.

• Online sales rose 10.1% to $286.4 million, now 14% of total sales; active club membership increased 8.1% to 12 million, with club member sales comprising 79% of total sales.

• Net profit after tax declined 9.5% to $129.8 million, with normalised NPAT at $130.8 million.

• 19 new stores opened in the half, with a target of 28 for FY25; store network expanded by a net 15 stores to 774 locations.

• Fully franked interim dividend of 32 cents per share declared; no drawn bank debt and $168 million cash on hand.

Financial highlights

• Gross margin declined 70 basis points to 45.6%, mainly due to loyalty investment and elevated stock loss.

• Statutory NPAT was $129.8 million; normalized NPAT was $130.8 million.

• Operating cash flow was $389 million, with 94% EBITDA cash conversion; cash flow from operations was $388.6 million, down 18.7% year-over-year.

• Basic EPS was 57.5 cents, down from 63.5 cents year-over-year.

• Capital expenditure was $98.8 million in the half, mainly for new stores, distribution centre, and digital projects.

Outlook and guidance

• CapEx for FY25 targeted at $165 million, focused on store development, new distribution centre, and digital capability.

• 28 new store openings planned in FY25; duplicated DC transition costs of $10 million expected.

• Positive trading start to the second half, with group gross margins tracking ahead of prior year for the first seven weeks.

• Ongoing cost pressures and FX volatility may impact short-term margin recovery, but price increases are expected to offset over time.

• No material events after reporting date affecting outlook.