Baby goods retailer Baby Bunting has reported a soaring set of revenue and profit improvements for the first half of the new financial year, resulting in the decision to increase its dividend by over 40%.
Total sales of $217.3 million, up 16.6% on the prior corresponding 26-week period
Pro forma EBITDA of $18.5 million, up 29.7% pcp
Statutory NPAT up 54.7% to $7.5 million
Fully franked interim dividend of 5.8 cents per share (1H FY20: 4.1 cents)
Total online sales growth of 95.9%, with click & collect sales growth of 218%
Total sales were $217.3 million in the half, representing growth of 16.6% as all stores remained open during the period. However, sales did moderate in Victoria as a result of the stage 4 lockdown in Melbourne.
Gross profit margins were up due to a range of improvements with supplier partners delivering products at sustainable margins, the continued growth of private label and exclusive products ranges and investments in the Baby on Board services business which contributes to margin expansion.
Private Label and Exclusive Products grew 28.2% to be 39.0% of total sales compared to 35.5% in the prior corresponding period, with the company targeting above 40% for the full year and a long-term target of 50% of all sales coming from private label and exclusive products.
Total online sales (including click & collect) grew 95.9%, making up 19.7% of total sales. Click & collect sales grew 218% and are now around 55% of all online sales in catchments where Baby Bunting has a store.
Investment in Digital continues as website visits continue to increase, with a migration to a headless e-commerce architecture underway.
Baby Bunting opened three new stores in the first half, being Knox (Vic), Castle Towers (NSW) and Coffs Harbour (NSW). There are now 59 Baby Bunting stores around Australia, with plans to see a network of over 100 stores around Australia.
Baby Bunting commenced shipping online orders to New Zealand in July 2020 and has completed an assessment of a NZ$450 million New Zealand market opportunity. There are now plans to launch a multi-channel retail proposition in New Zealand with the first store anticipated to open in FY22 as part of a network plan of at least 10 stores.