The group, which includes Briscoe Homeware and Rebel Sports stores, reported earnings before interest and tax of $37.9million for the six months ended July 31, up 34.5% on the $28.2million reported in the previous corresponding period.
Revenue rose nearly 10% to $268.3million from $243.9million.
The reported profit of $27.25million was up 33% from $20.5million in the pcp.
An interim dividend of 7c per share was declared. The payout ratio of 56% was below the previous year and conservative.
Forsyth Barr broker Suzanne Kinnaird said the profit was in line with expectations and recent guidance.
Earnings growth was driven by a strong performance from both homewares and Rebel Sport, with strong same-store sales growth and an impressive lift in margins.
``Briscoes faces earnings growth headwinds in 2017, namely cycling an extra week and a further step down in its effective New Zealand dollar-US dollar [exchange] rate. We expect reported growth to slow in the second-half, albeit remaining strong if we normalise for the extra week. We are not expecting to make any material changes to near-term earnings expectations.''
Briscoe Group managing director Rod Duke said to post a record first-half profit representing growth of more than 30% was a great achievement, despite the ongoing competitiveness of the retail environment and the impact on winter-dependent categories with the late start to the colder months.
Among the store reconfigurations was the completion of a major project at the Dunedin centre. By taking additional space next to the store, the group had extended and improved the storage area, increased the retail footprint of the homeware store and added a centre specifically to service lower South Island online sales for both homeware and sporting goods, he said.
During the six months under review, Briscoe received a dividend of $1.2million from its 19.9% holding in Kathmandu Holdings.
``As the largest single shareholder, we continue to watch their performance closely and note the progress management is making as they seek to restore historical levels of profitability.''
It would be imperative for retailers to focus on protecting their gross margin percentages into 2017, Mr Duke said.
The New Zealand dollar had recently strengthened against the US dollar from below US70c. However, hedging of foreign exchange exposures taken across the last 12 months at less favourable rates than those available currently would continue to flow through to the cost of imported product.
``This will cause increased pressure on the gross profit margin percentage for the second half of the year.''
