The Accent Group Ltd (ASX: AX1) share price just rocketed 19.2%.
Shares in the All Ordinaries Index (ASX: XAO) footwear and clothing retailer closed yesterday trading for $1.85. In morning trade on Friday, shares are swapping hands for $2.20.
For some context, the All Ords is down 1.09% at this same time.
This follows the release of Accent's financial year results for the 53 weeks ending 2 July (FY23).
(Note, the comparative figures below are based on 52 weeks in FY22.)
Here's what ASX investors are mulling over.
Accent share price soars on growth results
- Total sales of $1.57 billion, up 7.7% from FY22
- Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 39.6% year on year to $289 million
- Net profit after tax (NPAT) of $89 million, up 182% from FY22
- Final dividend of 5.5 cents per share fully franked, up 22% from 4.0 cents per share in FY22
What else happened during the year?
Atop the total sales growth, the Accent share price is also likely getting some tailwinds from the 26.3% growth in total owned sales. Total owned sales, which exclude sales from The Athlete's Foot Franchise, reached $1.39 billion for the year.
The company also reported strong results from its online segment, with online sales of $251 million contributing 19.1% of total sales.
And the gross margin increased by 1.0% over the year to 55.2%.
The company said the strong sales results were achieved across all its major banners, including Platypus, Skechers, TAF, Hype DC, Vans and Dr Martens.
Accent noted that, "As trade softened in May and June, Skechers, TAF and Hype DC, in particular, continued to experience positive comp store sales growth."
Management also kept a close eye on inventory levels, reporting that closing inventory for the year was below FY22 with clean aged inventory.
Ongoing store growth could also be helping boost the Accent share price today.
FY23 saw Accent open 80 new stores, transition 15 stores from discontinued into continuing brands, and close 21 stores where required rent outcomes could not be achieved. Total store numbers (including websites) now number 821 stores, up from 762 a year ago.
And those new stores could benefit from the 500,000 increase in contactable customers, which reached 9.8 million at the end of FY23.
As for the dividend, eligible investors can expect to see that land in their bank account on 28 September.
The full-year dividend payout comes out to 17.5 cents per share, up a whopping 169% from FY22.
What did management say?
Commenting on the results sending the Accent share price soaring today, CEO Daniel Agostinelli said:
The continued focus on customers, new product, and return on investment has delivered a record result and continues the journey of growth in profit and shareholder returns that has seen profit growth achieved in five of the last six financial years.
Chairman David Gordon added:
The achievement in FY23 of return on shareholder equity in excess of 20% and total dividends for the year of 17.5 cents per share should give stakeholders every confidence in the strength of the Accent business and management team.
What's next for the Accent share price?
Looking at what might impact the Accent share price in the year ahead, the company said it would continue growing its retail footprint, with at least 50 new stores planned to open in FY24.
Accent is also targeting continued growth in its digital sales and customer loyalty programs, "driving improvement in customer spend frequency".
Commenting on the outlook, Agostinelli said:
We recognise that there is ongoing uncertainty in the economic outlook, and like others we have experienced softening sales across May and June and into the first seven weeks of this year, with apparel being softer than footwear…
The Accent team is focused on executing our plan for FY24 including driving new product innovation, tight management of inventory leveraging clean stock levels coming out of FY23, opening at least 50 new stores, growth from our existing and new distributed brands and a continued drive on cost efficiency and gross margin improvement.
Accent share price snapshot
The Accent share price has been a strong performer, up 36% over the past 12 months, not including the dividend payouts.
