Nick Scali posts a record profit, its shares go nuts

Peter Macdiarmid/Getty Images

Shared in Nick Scali soared after the furniture retailer defied the retail slump and posted a record annual profit, partly due to the opening of more stores and lower costs.

A short time ago, the shares were up 13% to $6.80.

The company lifted net profit after tax by 10.1% to $40.98 million for the year to June.

Revenue was up 7.7% to $250.8 million.

“The result demonstrates that the continued store roll out provides significant leverage enabling us to improve our operating margins and also lower our cost ratios, which is essential for future profit growth,” says Managing Director Anthony Scali.

“Our cash flow and balance sheet remain strong, allowing us to take advantage of opportunities that may arise.”

Six new Nick Scali stores opened in 2018 year including the first store in New Zealand.

This year the company is opening another six stores, including a second store in New Zealand, bringing the network to 60 stores by December 2018.

The company declared a fully franked dividend of 24 cents a share, up 20.0%, bringing the total payout to 40 cents, up 17.6% on last year.

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