Morningstar | Super Retail Group’s Audited Accounts Hold No Surprises After Announcing Key Figures
Our AUD 7.50 fair value estimate on no-moat Super Retail Group stands. Cash flows, balance sheet and the P&L down to the EBIT level were released on Feb. 12, 2019. Today, the company followed up with NPAT and dividends for the half-year fiscal 2019.Yesterday, Supercheap Auto’s main competitor Bapcor reported similar like-for-like sales figures for its Autobarn retail chain, at around 2%. But Bapcor’s headline retail sales figures grew faster than Super Retail’s core auto segment, at 8.8% versus 2.7%. This highlights the competitive tension Super Retail is dealing with in auto, on top of the threat of online players such as new entrant Amazon Australia. From a cyclical standpoint, our concerns around near-term consumer sentiment weighing on the Australian retailing sector, including auto parts, were also recognised by Bapcor’s management. Bapcor reiterated its earnings guidance for fiscal 2019, but at the low end of its guidance range, due to challenging market conditions--calling out declining consumer confidence, soft house prices, and political uncertainty, as well as increased competition.
Super Retail announced an increase in underlying NPAT of 8.9% to AUD 81.6 million, tracking with our full-year fiscal 2019 NPAT estimate of AUD 151 million. Earnings from sports and outdoor are seasonally skewed to the first half of the fiscal year, which includes Christmas, and we don’t envisage a material improvement in sales growth or EBIT margins across the group’s three segments in the second half of fiscal 2019. Perhaps reflecting an also-cautious Super Retail board, the interim dividend was unchanged at AUD 21.5 cents, despite the lift in underlying EPS. The interim dividend was flat in fiscal 2018, but that year underlying NPAT was up by only 0.7%.
For more detail on Super Retail’s first-half year results, please refer to our analyst note “Super Retail Group's Mixed Interim and CEO's Early Departure Don't Move Our AUD 7.50 FVE†published Feb. 12, 2019.
Super Retail Group's main activities are result in the following business segments: Auto, which include retailing of auto parts and accessories, tools and equipment; Leisure, which include retailing of boating, camping, outdoor equipment, fishing equipment and apparel; and Sports, which include retailing of sporting equipment, bicycles, bicycles accessories and apparel. Co.'s principal brands include Amart Sports for sports products such as equipment, apparel and associated accessories; BCF for an outdoor retailer; Rays for an outdoor entertainment and camping leisure retailer; Rebel for sporting and goods such as fitness equipment; and Supercheap Auto for automotive parts and accessories.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.