REDgroup Retail Doubles Profits

REDgroup Retail Pty Ltd today announced a 101% increase in first half Earnings Before Interest & Tax (EBIT) of $ 22.1m, this result was before one-off integration costs of $ 3.9m. The acquisition of Borders in June 2008 contributed to the robust financial performance of REDgroup for the 26 weeks ended 28 February, 2009.

The one-off costs were incurred in respect of integrating the Borders business into the wider group. The company reported that the integration of the two businesses has progressed to plan, including the successful migration away from Borders legacy IT systems to REDgroup's SAP platform.

REDgroup Executive Chairman, Rod Walker, said that he was pleased with the way the company was performing particularly considering the tough economic environment.

"It is a testament to the strength of our brands that we have successfully grown both sales and margin during the last few months whilst also reducing costs.

"The confidence we have in these businesses is reflected in our commitment to invest now for future growth," said Mr Walker. During the first half of the year we opened two new Borders stores and a third opened earlier this month. At Angus & Robertson, we have invested in three new stores and developed two new ‘icon’ stores which we are using to trial future store design concepts. A selection of the icon store concepts will also be introduced to the New Zealand market through upcoming Whitcoulls store refurbishments, starting with the refurbished Riccarton store which opened this week."

Mr Walker concluded, "The business remains on track to achieve both its synergy targets and full year earnings forecasts."