The main driver for Country Road’s success in 2012 was the strong trading performance in South Africa and it appears to be headed that way again for the 2013 financial year.
The company’s total sales for the 2012 financial year grew $419 million, up by 1.8 per cent on the prior year driven by strong sales in South Africa. Meanwhile total Australasian sales were down 2.6 per cent on the year with comparable sales down 6.6 per cent. Its reported total profit before tax was $20.5 million, after costs of $1.5 million were incurred as a result of the acquisition of the Witchery Group.
Speaking at the company’s AGM, Country Road chairman Ian Moir said trading for this year has started well with strong trading continuing in South Africa.
“We have started the year well with Australasian comparable sales up 13.5 per cent on the prior year. Total Australasian sales were $116 million. In South Africa our brands continue to trade well with comparable sales up 8.5 per cent on the prior year,” he said.
Moir also highlighted the company continues to experience strong online store performance with belief the strength will continue on into 2013.
“Throughout the year we improved our business efficiency. We continued to focus on reducing expenses and improving inventory control and this ensured that operating margin and profit are maintained broadly in line with the prior year,” he said.
Country Road also completed the acquisition of the Witchery Group from Gresham Private Equity for $172 million in October. They also welcomed Iain Nairn, the former CEO of Witchery, as the company’s new CEO and managing director for the expanded group. As a result of this change, Howard Goldberg left the business.
“Going forward, we will focus on the successful integration of the Witchery Group, delivery of synergy benefits and profitable growth of the combined businesses,” he said.