Retail: Baby Bunting’s online sales grew 43pc, shares grow 15pc
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Baby Bunting (ASX:BBN) was up over 15 per cent in early trade after outlining a 43 per cent jump on NPAT year on year to $12.4 million on the back of a 21 per cent jump in profit.
Releasing its annual results to the market today, it said an investment in digital had started to pay dividends — particularly where there was a store within the catchment area of the orderer, which points to growth in the ‘click and collect’ model.
“Digital remains a very important part of Baby Bunting’s business with total online sales growing 46 per cent, including click and collect sales growing 55 per cent on the prior financial year,” it said.
“Online sales represented 11.8 per cent of total sales. The trends observed in the past continue with online sales in relevant catchments consistently increasing following the opening of a Baby Bunting store in that catchment. The growth in the store network complements the growth in online sales.”
With digital sales now up and the click and collect strategy working, Baby Bunting is now looking to expand its store base from its current 53 to over 80.
It also said that it would seek to make more investments into services, initially aimed at car seat installation.
“We have around 30 [baby seat] installers working across our store network with plans to expand this number,” it said.
It only recently started accepting bookings for car seat installations online, and said growth in this sector would be followed by a car seat or capsule hire service.
“This service will provide parents with a choice of hiring a car seat or capsule appropriate for their child’s age and stage of development. It will also provide short term hire for parents travelling interstate or when families come to visit from overseas.”
Jewellery chain Michael Hill (ASX:MHJ) reported in with an underlying EBIT dive of 13.7 per cent — down to $34.6 million. While it still made a gross profit of $353 million, this was down from the previous year by 3.8 per cent.
It did make a statutory EBIT gain of 138 per cent, largely down to the fact that it needed to pay back staff in the previous year after it found it had been underpaying workers over the past six financial years. Its Australian store revenue went down by 3.7 per cent, its New Zealand revenue went down by 4.1 per cent, but it had a better time in Canada with revenue up by 1.8 per cent.
While the company said the results were disappointing, it pointed to Q4 same store sales growth of 0.7 per cent as evidence that momentum was starting to gather. It’s paying out a dividend of 1.5c, with an ex dividend date of 12 September.