The Super Retail Group Ltd (ASX: SUL) share price is climbing higher on Thursday.
In morning trade, shares in the automotive and outdoor retailer are up 4.8% to $13.98. However, the company's share price traded at $14.44 moments after opening. The movement follows the release of the company's full-year results for FY23.
Let's pop the hood and take a closer look.
Image source: Getty Images
Super Retail share price rallies on resilient year
The following figures are adjusted to account for the prior financial year containing 53 trading weeks versus 52 in FY23.
- Total group sales up 9% to $3,803 million
- Earnings before interest, tax, depreciation and amortisation (EBITDA) up 11% to $768 million
- Statutory group net profit after tax (NPAT) up 11% to $263 million
- Fully franked final dividend of 44 cents per share, up from 43 cents
- Fully franked special dividend of 25 cents per share declared
What else happened in FY23?
Despite the 12 months ending 30 June being clouded in economic uncertainty, Super Retail Group delivered sales growth across all retail brands. Although, sales under the BCF brand were more subdued, increasing a mere 3% to $840 million.
Notably, the retailer's most significant segment — Supercheap Auto — posted total sales of $1.45 billion, growing a solid 10% over the prior year. Moreover, the automotive retail brand experienced a higher average transaction value (ATV).
During the year, sales were bolstered by auto maintenance (lubricants, car detailing, and power), with this being the strongest performing category under the Supercheap Auto banner.
Once again, the company's newer outdoor Macpac brand grew at an exceptional rate in FY23. Taking pole position as the fastest-growing segment inside Super Retail Group, Macpac sales surged 27% to $216 million, accounting for ~5.7% of group sales.
Favourable weather conditions and outbound tourism reportedly aided the standout performance.
Super Retail Group shared a trading update on 3 May 2023, indicating offshore freight costs had returned to pre-pandemic levels. Although, management suggested inflationary pressures would impact the cost of doing business in the second half.
The Super Retail share price gradually fell following this update, as shown in the chart above, until late June.
What did Super Retail management say?
Providing a look into what measures were taken to deliver today's result, Super Retail Group CEO Anthony Heraghty said:
During the year, the Group successfully implemented a range of cost-saving initiatives in sourcing, supply chain and logistics, and workforce management designed to manage costs, improve productivity and enhance workplace efficiency.
These initiatives enabled the Group to help offset the impact of the high inflationary environment on wages, electricity and rent.
Furthermore, Heraghty noted the company was able to deliver growth in the second half despite higher interest rates and cost of living expenses, adding:
This result is testimony to the leading market position of our brands, the resilience of the categories in which we operate, the quality of our team and the strength of our connection with our loyal and expanding customer base.
What's next for Super Retail Group?
The ASX-listed retailer did not provide any forward guidance in today's release. However, a trading update for how FY24 is tracking was included.
Like-for-like sales growth as at week six of FY24 compared to FY23 did not appear as rosy. The only segment showing an increase is Supercheap Auto, rising 3% versus its comparable period. Whereas the other brands' growth, or lack of it, included:
- Rebel down 1%
- BCF down 1%
- Macpac down 9%
Heraghty pointed to dampened consumer spending caused by interest rates and inflation for the moderating sales growth.
Super Retail share price snapshot
Although the Super Retail share price is up roughly 29% in 2023, the path has included its fair share of twists and turns.
At one point in June, shareholders would have been in the red year-to-date. Yet, shares in the Aussie retailer rebounded in the months that followed.
Based on the FY23 net profits, Super Retail Group trades on a price-to-earnings (P/E) ratio of approximately 11.8 times earnings.
