Noni B upgrades profits despite tough market
Australian fashion giant Noni B has warned that the current financial year is a challenging one and sales growth is hard to come by. But it has also upgraded profits guidance due to the one-off impact of better-than-expected savings from its recent acquisitions.
That news from its annual meeting sent its shares soaring on Friday but that investor confidence didn’t address the underlying problem of slowing sales. The company said that like-for-like sales have fallen 5% since July, although that was expected as the company worked on integrating the acquired Speciality Fashion chains, Millers, Katies, Rivers, Crossroads and Autograph, into its existing business.
The company had reported comparable sales up as much as 4.5% for fiscal 2018, but at leats it expects its current weak sales performance to recover throughout this year. It also said that it’s on track to achieve more savings from the acquired Specialty Fashion business and to achieve them faster than it had expected.
That should help pre-tax earnings to rise by 21% to A$45 million for fiscal 2019.
CEO Scott Evans has built Noni B into one of Australia’s biggest fashion companies and its sheer size seems to be carrying it through what chairman Richard Facioni admitted is a tough sector at present.
Facioni said the first four months of fiscal 2019 have seen ongoing difficult conditions, although those conditions are what gave it the opportunity to buy the struggling Specialty Fashion brands in the first place.
But Facioni also said the enlarged group’s digital sales have continued to grow with a 67.8% rise, while digital still only accounts for 5.8% of sales so there’s plenty of growth potential ahead.
Noni B’s full-year net profit for fiscal 2018 rose 431% to A$17.29 million.
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