Accent Group Limited (ASX:AX1) Announces H1 FY25 Results
Financial Performance
Accent Group Limited reported total sales (including The Athlete’s Foot Franchise sales) of $845 million, a 4.2% increase from the prior year. Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) reached $158.3 million, while Earnings Before Interest and Tax (EBIT) rose 11.5% to $80.7 million. Net Profit After Tax (NPAT) was $47.2 million, and Earnings Per Share (EPS) stood at 8.35 cents.
Operational Review
The company achieved Like-for-Like (LFL) retail sales growth of 2.9%, opened 42 new stores, and increased total store numbers to 903. Inventory levels remained in line with plans, and aged stock levels were maintained clean. Cost of Doing Business (CODB) was managed at 44.7%, down from 45.0% in H1 FY24.
Gross margin was impacted by a value-driven consumer environment, decreasing by around 70 basis points from the prior year.
Dividend
Accent Group declared a fully franked interim dividend of 5.5 cents per share, payable on 20 March 2025 to registered shareholders as of 6 March 2025.
Growth Plan Update
The company continues to pursue growth opportunities, including opening more than 10 new stores in H2 FY25.
Strategic Agreement with Frasers
Accent Group is in active discussions with Frasers Group on a long-term strategic agreement, with negotiations expected to conclude in the second half of FY25.
Executive Comments
CEO Daniel Agostinelli stated, “In the context of the challenging consumer environment in H1, the growth in sales and profit reflects the strength of the Accent business model and the ongoing drive of the entire Accent team. During the half, the company delivered 2.9% Like-for-Like (LFL) retail sales growth, opened 42 new stores, secured the distribution rights for Dickies and Lacoste, divested The Trybe business and made progress on the closure of underperforming Glue stores. In the more promotional environment which impacted gross margin, the controllable levers of inventory and costs were well managed.”
Mr Agostinelli added, “Sales growth in the first 7 weeks of H2 has been positive including a record result from Back to School across the business. In a challenging consumer environment, the team are focused on driving profitable sales, managing controllable costs and executing the growth plan initiatives.”
Motley Fool contributor Matt Burgess has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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