The Super Retail Group Ltd (ASX: SUL) share price is scaling new heights on Thursday.
In morning trade, the retail conglomerate's shares are up 6% to a record high of $17.68.
Investors have been buying the Supercheap Auto owner's shares following the release of its FY 2024 results.
Super Retail share price hits record high on FY24 results
- Sales up 2% to $3.9 billion
- Gross margin increased 10 basis points to 46.3%
- Segment earnings before interest and tax down 9% to $400 million
- Normalised net profit after tax down 11% to $242 million
- Fully franked final dividend down 15.9% to 37 cents per share
- Special dividend doubled to 50 cents per share
What happened during the year?
For the 12 months ended 30 June, Super Retail posted a 2% increase in sales to $3.9 billion. This reflects growth across Supercheap Auto, BCF, and Macpac brands, which offset a decline in Rebel sales.
Group online sales across all brands increased by 9% in FY 2024 to $485 million. This means that online sales as a percentage of total sales increased from 12% in the prior corresponding period to 13%. Click & Collect sales accounted for 45% of group online sales.
And while gross margins increased 10 basis points to 46.3%, this was more than offset by a 120 basis points increase in its cost of doing business to 36%. Management notes that the latter was driven primarily by the impact of inflation on wages and rent.
This ultimately led to group normalised net profit after tax decreasing by 11% to $242 million.
In light of this profit decline, the Super Retail board elected to cut its fully franked final dividend by 15.9% to 37 cents per share. This brought its total ordinary dividends to 69 cents per share in FY 2024, which is down from 78 cents per share a year earlier.
However, Super Retail has announced another special dividend. And it's a whopper! The company is paying a special dividend of 50 cents per share, which is double the 25 cents per share special dividend it paid last year.
This represents an aggregate dividend payment of 119 cents per share.
Management commentary
Super Retail's managing director and CEO, Anthony Heraghty, was pleased with the results. He said:
Super Retail Group delivered a solid financial performance in FY24 as record sales and higher gross margin helped mitigate the impact of inflation on our cost base.
In a macroeconomic environment where cost-of-living pressures are dampening consumer spending, the delivery of top-line growth is a testimony to the strength of our four core brands and the resilience of the categories in which we operate.
After taking into account a resilient trading performance, strong operating cashflow and the strength of the Group's balance sheet, I am pleased to advise that, in addition to the payment of a final fully franked dividend of 37 cents per share, the Directors have determined to pay a special fully franked dividend of 50 cents per share.
Outlook
Potentially giving the Super Retail share price a boost today has been the release of a trading update.
The company revealed that all brands delivered like-for-like and total sales growth during the first seven weeks of FY 2025.
This has led to group like-for-like sales growth of 3% and total sales growth of 5% over the period.
Commenting on its outlook, Mr Heraghty said:
The Group has made a strong start to the year with positive sales momentum across all of our four core brands.
The outlook for the consumer in the year ahead remains uncertain given ongoing cost-of-living pressure on household budgets. We will continue to manage our costs effectively while investing in the business for future growth.
The Group's customer value proposition, the strength of our brands and the size of our customer loyalty club membership base means Super Retail Group remains well positioned to perform in retail market conditions where customers are carefully managing their spending and prioritising value-for-money purchases.
