The Reject Shop posts big profit jump

rejectshopThe Reject Shop have announced net profit after tax of $18.3 million in their half year FY2016 results, representing an increase of 43 per cent on the previous corresponding period.

The discount variety retailer saw sales for the half reach $424.7 million, signalling an increase of 5.6 per cent with comparable store sales growth of 4.4 per cent in the six months to December 27. The company said this was a significant improvement on the -3.3 per cent in the prior corresponding period.

“While we are pleased with the continuing improvement in performance as a result of the actions we have taken, we have much more to do over the next three years,” said The Reject Shop’s MD, Ross Sudano. “The momentum of the first half has continued into the first six weeks of the second half with comparable store sales growth continuing at a rate consistent with that recorded in the second quarter.”

Generated earning before interest depreciation and amortisation (EBITDA) was $36 million, representing an increase of 26.3 per cent on the prior corresponding period for the company.

Eight new store openings in conjunction with the closing of three stores takes the retailer’s national portfolio to 338 stores for the half.

“The company will open five new stores in the second half, while also planning to close five stores, three of which are as a result of redevelopments in centres where the business is located,” said Sudano.

Chairman of The Reject Shop, Bill Stevens, also announced an interim fully franked dividend of 25.0 cents per share, up from 16.5 cents.

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