A significant protest vote has been lodged against the re-election of Super Retail Group Ltd (ASX: SUL) chair Judith Swales, as the group delivered mixed sales growth results for the first quarter.
Strong sales growth at outdoor gear retailer Macpac was offset by weak numbers at fishing and outdoor retailer BCF, the company said on Thursday before its annual general meeting, sending its shares 1.5% lower to $16.90.
The diversified retailer delivered sales growth across all of its major brands – Supercheap Auto, Rebel, BCF, and Macpac – but it was the latter which really shot the lights out, increasing total sales 16.9% and like-for-like sales by 8.5%.
Super Retail boosted its overall sales by 4.5% and like-for-like sales by 2.6% for the first 16 weeks of the financial year.
Like-for-like sales at BCF were up just 0.3%, with Rebel coming in at 3.2%, and Supercheap Auto at 2.6%.
Mixed results
Interim Chief Executive Chris Burns said the Supercheap Auto division had continued its positive momentum from the previous financial year, with strong contributions from categories such as filtration, braking, and wipers.
Macpac has enjoyed strong sales momentum, with double-digit like-for-like growth since the trading update in August, and a solid contribution from recently opened stores. rebel's performance continues to reflect variable demand patterns experienced calendar year-to-date, with softness in football and basketball categories offset by strong growth in footwear. Pleasingly, momentum has improved in October.
BCF was the weakest division, impacted by a softer Father's Day campaign, poor weather in New South Wales, and the algal bloom in South Australia.
Mr Burns said the company had recently launched its loyalty program for Supercheap Auto, Spend & Get, which was expected to have a positive impact.
On the overall outlook, Mr Burns said the company was cautious.
Whilst macro-economic conditions appear to be improving, the outlook for consumer spending remains uncertain. We expect consumers to continue to manage their spending carefully and prioritise value for money purchases. As always, the group's first half result will be highly dependent on trading in the peak Christmas trading period, with the cyber sales event commencing in the coming weeks.
Super Retail also released statements to the market on Thursday morning from Mr Burns and chair Judith Swales, which were to be delivered at the company's annual general meeting (AGM) later in the day.
Board acted on new information
Ms Swales said the company's board had been blindsided by recent allegations about former managing director Anthony Heraghty's alleged affair with the company's former HR chief officer, Jane Kelly, and had taken decisive action, sacking Mr Heraghty once new information came to light.
Ms Swales said in her statement to the AGM:
The board's review and investigation into allegations relating to the former group managing director and chief executive officer in 2023 was based on the information available at the time and was informed by external legal advice. When information that had not previously been disclosed to the board came to our attention last month, we acted quickly and decisively. To be clear, the new information recently received from Mr Heraghty was not information available from company records nor was it disclosed by him previously.
Ms Swales said in light of the seriousness of the matter, the board exercised its discretion to lapse more than $7 million worth of Mr Heraghty's incentive payments.
Ms Swales' re-election as a director on the board was to be voted on at the meeting, with a large protest vote of 25% of proxy votes lodged before the meeting going against her being reappointed.
