Another retailer is reporting rising profits, in further signs of a recovery in the sector.
New Zealand based retailer, Kathmandu Holdings (ASX: KMD) has raised its first half profit forecast by around 75% over the previous year. Net profit for the six months to December 2012, is expected to be between NZ$9.5 and NZ$10.5 million, compared to NZ$6 million in 2011.
In further signs of 2013 being a good year, Kathmandu expects up to 70% of its full year earnings to be made in the six months to June 2013.
Sales growth for the three months to September rose 20%, while sales for the key Christmas and January period had generally been in line with management’s expectations. CEO, Peter Halkett said that sales in Australia are growing at a faster rate than New Zealand.
The company has opened 9 new stores so far in the 2013 financial year, and expects to open a total of 15.
Kathmandu is not the only retailer reporting rising earnings. Specialty Fashion Group (ASX: SFH) reported earlier this week that it expects net profit after tax to almost triple to between $17-$18 million, for the half year to December 2012. And in early November, Country Road Limited (ASX: CTY) announced that sales for the group had increased by 37% in Australasia.
While all three are involved in fashion and clothing retailing, the signs may be there that the sector in general is staging a recovery.
The Foolish bottom line
Investors in other retailers such as Premier Investments (ASX: PMV) will be hoping their companies can emulate the results achieved by the three mentioned above.
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