Full Year Results Announcement

Results announcement
(for Equity Security issuer/Equity and Debt Security
issuer)
Updated as at 17 October 2019


Results for announcement to the market
Name of issuer BRISCOE GROUP LIMITED
Reporting Period Full Year – 27 January 2020 to 31 January 2021
Previous Reporting Period Full Year – 28 January 2019 to 26 January 2020
Currency New Zealand Dollars
Amount (000s) Percentage change
Revenue from continuing operations $701,797 +7.5%
Total Revenue $701,797 +7.5%
Net profit/(loss) from continuing
operations
$ 73,199 +17.0%
Total net profit/(loss) $ 73,199 +17.0%
Final Dividend
Amount per Quoted Equity Security $ 0.13500000
Imputed amount per Quoted Equity
Security
$ 0.05250000
Record Date 24 March 2021
Dividend Payment Date 31 March 2021
Current period Prior comparable period
Net tangible assets per Quoted Equity
Security
$ 1.1482 $ 1.3892
A brief explanation of any of the
figures above necessary to enable the
figures to be understood
Refer to section below “Full Year Review” for commentary.

Earnings before interest and tax (EBIT) is a non-GAAP measure.
Authority for this announcement
Name of person

authorised to make
this announcement
Geoff Scowcroft
Contact person for this announcement Rod Duke
Contact phone number + 64 9 815 3737
Contact email address rod.duke@briscoegroup.co.nz
Date of release through MAP

16/03/2021

Audited abridged financial statements accompany this announcement.

Full Year Review

Briscoe Group Posts Record Profit and Sales

Briscoe Group Limited (NZX/ASX code: BGP)

Highlights for the full year ended 31 January 2021:
• Total sales $701.8 million, +7.47%
• Gross profit $307.1 million, +19.27%
• Gross profit margin 43.76% vs 39.43% last year
• Online sales growth, +79.65%
• Online sales as mix of total Group sales, 18.82%
• Net profit after tax (NPAT) $73.2 million, +16.96%
• Final Dividend 13.5 cps

The directors of Briscoe Group Limited announce a record net profit after tax (NPAT) of $73.20
million for the year ending 31 January 2021, a 16.96% increase on the $62.58 million reported
for the previous year.

The result incorporates an additional week’s trading in comparison to the 52-week period last
year. The additional week is necessary because the Group operates on a weekly trading and
reporting cycle of 52 weeks for most years with a 53-week year required once every five to six
years to realign the financial and calendar year-ends.

Board Chair, Dame Rosanne Meo announced that the directors have resolved to pay a final
dividend of 13.5 cents per share (cps). The dividend is fully imputed and, when added to the
interim dividend of 9.0cps and the special dividend paid in January of 6.0cps, brings the total
dividend for the year to 28.5cps. The final dividend will be paid on 31 March 2021. The share
register will close to determine entitlements to the dividend at 5pm on 24 March 2021. “We’re
delighted to be in a position to increase both the interim and final dividend payments, in
addition to the recent special dividend paid to shareholders in January.

“We’re very proud of how our team has performed, the financial results produced and also of
how the Company has endeavoured to balance the interests of stakeholder groups - team,
customers, suppliers and shareholders alike.”

Rod Duke, Group Managing Director, said, “We are pleased to announce record sales and
profit for Briscoe Group in a year truly like no other. Navigating the twists and turns
encountered this year really has been like riding a retail roller-coaster. I’m immensely proud of
the commitment and effort shown by the entire Briscoe Group team which has enabled us to
remain focused on delivering our unique value proposition which clearly continues to resonate
strongly with customers. It is a priority for the business that the momentum established this
year continues as the basis for on-going growth and success.”

The earnings were generated on sales revenue of $701.8 million, an increase of 7.47% on the
$653.0 million generated for the previous year.

Gross Margin dollars increased 19.27% for the period with gross margin percentage increasing
from 39.43% to 43.76%. Rod Duke said, “The massive disruption to trading from Covid-19
accelerated our strategic plans to optimise margin. Our program of work focuses on all stages
of the product life cycle including;

• optimising our pre-season planning and buying processes,
• use of enhanced data analytics to maximise our seasonal trading events,
• improving inventory flow to shelf for new and replenishment product, and
• reducing our level of clearance product.”

Included in the result is a credit adjustment to tax expense totaling $0.68 million. This has
arisen from two reversals of deferred tax liability arising from; the sale of the Group’s Nelson
property and the reintroduction of tax depreciation on commercial and industrial buildings as
part of the Covid-19 Response (Taxation and Social Assistance Urgent Measures) Act.

The Group did not receive a dividend during the year from its investment in Kathmandu
Holdings Limited (KMD) as a result of their response to the Covid-19 situation. Last year the
Group received $9.5 million of rights entitlements benefits and dividends, in relation to the KMD
investment.

During the year $27.43 million of capital investment was made by the Group of which $18.30
million represents development of property owned by the Group in Auckland, Silverdale and
Invercargill. The balance of the capital investment was for the fit-out of relocated stores, online
platform improvements, security system upgrades and enhancements to system software and
hardware.

Inventories totaled $91.47 million at year-end, $4.06 million higher than the $87.41 million
reported for last year, predominantly reflecting imported homeware product, landed and
receipted earlier than usual as a contingency against possible supply disruption. Rod Duke
said, “Notwithstanding the widely reported ‘pandemic-inflicted’ pressures on product sourcing
and supply, the strength of our supplier relationships has been incredibly valuable for us in
securing consistency of supply. We are very grateful to our supply partners for the
collaboration and co-operation shown through this extraordinary year.”

Despite the major distraction across the entire business due to Covid-19, the Group
progressed a number of store development projects during the year. In May both the Briscoes
Homeware and Rebel Sport Nelson stores were relocated to a new dual site with more
carparking and better access for customers. The new stores are bigger and brighter with the
Rebel Sport store featuring the new generation fit-out. The former Rebel Sport premises which
was owned by the Group was sold.

In July the refurbishment of the Tauranga Briscoes Homeware and Rebel Sport stores was
completed. The new configuration has resulted in a bigger Briscoes Homeware store, new
back-of-house and common team facilities.

Work also continued on a number of projects in relation to Group owned properties. The re-
roofing of Briscoes Invercargill was completed in October 2020 and the construction of a new
Briscoes Homeware store at 36 Taylors Road, Auckland is now nearing completion and on
target for opening in early April 2021.

Rod Duke said, “We’re excited about the potential of this new store, which will be bigger,
brighter and feature a new contemporary fit-out. The opening of this store will then allow us to
introduce a new Rebel Sport store in the retail space on the ground floor of the Support Office
building at 1 Taylors Road.”

The development at Silverdale is continuing well with the building construction now well over
half completed. The opening of these new generation Briscoes Homeware and Rebel Sport
stores in October 2021 will make it easier for our customers in Silverdale, Orewa, on the
Hibiscus Coast and surrounding areas to shop with us.

The Group’s online business experienced extraordinary growth with the move to the national
lockdown in March and continued to produce strong growth throughout the remainder of the
year finishing with growth of 79.65% above online sales for the 2019/20 year. Rod Duke said,
“This represents 18.8% of total Group sales and whilst this mix was clearly assisted by the
closure of bricks and mortar stores during the two lockdown periods, we are confident that the
online mix of sales moving forward will have experienced a significant step-change from the
11.3% recorded for the previous year. The accelerated roll-out of Click and Collect across the
entire network proved invaluable during the lockdown periods and is a great example of how
quickly the team can respond and accelerate plans when required. The service is proving
extremely popular accounting for 30% of all online sales processed during the second half of
the financial year.

Rod Duke said “While the recovery across most of New Zealand retailing since the end of
lockdown has been significant, the agility shown by the Briscoe Group team to adapt to and
leverage the new trading conditions has also been nothing short of incredible.

“In addition, the strategic initiatives established at the start of 2020 have laid the foundations
for a range of plans to sustain and build the business across the next 3-5 years. These plans
revolve around three key areas:
• Significantly enhancing the shopping experience our customers enjoy with us,
• An end to end review and redesign of our supply chain, from source to customer, and
• Developing new streams of revenue.

“We have partnered with KPMG in relation to identifying and implementing supply chain
improvements. Their experience from working with a number of other retailers will be
invaluable and benefits have already started to be realised.”

Group Chair Dame Rosanne Meo said, “This year’s results highlight the Group’s ability to
perform, adapt and deliver improved performance under the most extraordinary trading
conditions. The quality of the leadership shown by the senior executive team has been
impressive and on behalf of the Board I would like to acknowledge the great work done by the
entire Briscoe Group team. The outlook is certainly complex and uncertain but we are confident
that the business is well placed in relation to both team and strategy to deliver improved profit
and returns to shareholders.”


Tuesday 16 March 2021
Contact for enquiries:

Rod Duke
Group Managing Director
Tel: + 64 9 815 3737

Briscoe Group Limited is a company incorporated in New Zealand and registered in Australia as a foreign company under the name
Briscoe Group Australasia Limited (ARBN 619 060 552). It is listed on the NZX Main Board and also the Australian Securities Exchange
as a foreign exempt entity. (NZX/ASX code: BGP).

BRISCOE GROUP LIMITED
CONSOLIDATED INCOME STATEMENT
for the 53 week period ended 31 January 2021


Period ended
31 January 2021
Period ended
26 January 2020
$000 $000
Sales revenue 701,797 653,017
Cost of goods sold (394,681) (395,515)
Gross profit
307,116 257,502
Other operating income 139 9,661
Store expenses (110,845) (100,342)
Administration expenses (80,524) (69,598)
Earnings before interest and tax 115,886 97,223

Finance income 421 724
Finance cost (14,888) (13,635)
Net finance cost (14,467) (12,911)

Profit before income tax 101,419 84,312
Income tax expense (28,220) (21,729)
Net profit attributable to shareholders 73,199 62,583

6
BRISCOE GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the 53 week period ended 31 January 2021


Period ended
31 January 2021
Period ended
26 January 2020
$000 $000
Net Profit attributable to shareholders 73,199 62,583
Other comprehensive income:
Items that will not be subsequently reclassified to profit or loss:
Change in value of investment in equity securities (92,174) 38,513
Items that may be subsequently reclassified to profit or loss:

Fair value gain recycled to income statement (608) (4,077)
Fair value (loss)/gain taken to the cashflow hedge reserve (2,084) 3,022
Deferred tax on fair value gain taken to income statement 170 1,142
Deferred tax on fair value (loss)/gain taken to cashflow hedge reserve 584 (846)
Total other comprehensive (loss)/income (94,112) 37,754
Total comprehensive (loss)/income attributable to shareholders (20,913) 100,337

BRISCOE GROUP LIMITED
CONSOLIDATED BALANCE SHEET
As at 31 January 2021


31 January 2021 26 January 2020
$000 $000
ASSETS
Current assets
Cash and cash equivalents 100,417 67,414
Trade and other receivables 3,534 3,533
Inventories 91,473 87,414
Held-for-sale assets - 5,408
Derivative financial instruments 32 269
Total current assets 195,456 164,038

Non-current assets
Property, plant and equipment 117,397 97,265
Intangible assets 3,608 3,464
Right-of-use assets 255,850 266,001
Deferred tax 14,750 11,676
Investment in equity securities 61,930 154,104
Total non-current assets 453,535 532,510
TOTAL ASSETS 648,991 696,548

LIABILITIES

Current liabilities

Trade and other payables 80,952 81,260
Lease liabilities 19,277 17,744
Taxation payable 12,413 4,895
Derivative financial instruments 3,378 1,014
Total current liabilities 116,020 104,913

Non-current liabilities
Trade and other payables 930 852
Lease liabilities 272,994 278,664
Total non-current liabilities 273,924 279,516
TOTAL LIABILITIES 389,944 384,429

NET ASSETS 259,047 312,119

EQUITY
Share capital 61,839 60,752
Cashflow hedge reserve (2,457) (519)
Equity-based remuneration reserve 444 841
Other reserves (25,923) 66,251
Retained earnings 225,144 184,794

TOTAL EQUITY 259,047 312,119

8
BRISCOE GROUP LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
for the 53 week period ended 31 January 2021


Period ended
31 January 2021
Period ended
26 January 2020
$000 $000
OPERATING ACTIVITIES
Cash was provided from:
Receipts from customers 701,574 652,701
Rent received 15 12
Dividends received 3 6,832
Premium received from KMD rights issue - 2,720
Interest received 450 850
Insurance recovery 22 97
702,064 663,212
Cash was applied to:
Payments to suppliers & employees (530,188) (525,678)
Interest paid (14,889) (13,631)
Net GST paid (27,508) (20,310)
Income tax paid (22,913) (24,085)
(595,498) (583,704)

Net cash inflows from operating activities 106,566 79,508

INVESTING ACTIVITIES
Cash was provided from:
Proceeds from sale of property, plant and equipment 1,996 11
1,996 11
Cash was applied to:
Purchase of property, plant and equipment (25,540) (17,410)
Purchase of intangible assets (1,889) (1,768)
Investment in equity securities - (13,602)
(27,429) (32,780)

Net cash outflows from investing activities (25,433) (32,769)

FINANCING ACTIVITIES
Cash was provided from:
Issue of new shares 919 1,620
Net proceeds from borrowings - -
919 1,620
Cash was applied to:
Dividends paid (33,370) (45,494)
Lease liabilities payments (15,588) (16,264)
(48,958) (61,758)

Net cash outflows from financing activities (48,039) (60,138)

Net decrease in cash and cash equivalents 33,094 (13,399)
Cash and cash equivalents at beginning of period 67,414 80,777
Effect of exchange rate changes on cash and cash
equivalents (91) 36

CASH AND CASH EQUIVALENTS AT END OF PERIOD 100,417 67,414

BRISCOE GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the 53 week period ended 31 January 2021



Share Cashflow Equity-Based Other Retained Total
Capital Hedge Remuneration Reserves Earnings Equity



Reserve Reserve



$000 $000 $000 $000 $000 $000



Balance at 27 January 2019

58,929 240 1,097 27,738 185,537 273,541
Impact of adopting NZ IFRS 16

- - - - (18,205) (18,205)



Adjusted balance as at 28 January 2019

58,929 240 1,097 27,738 167,332 255,336
Net profit attributable to shareholders for the period

- - - - 62,583 62,583
Other comprehensive income:


Change in value of investment in equity securities

- - - 38,513 - 38,513
Net fair value loss taken through cashflow hedge reserve

- (759) - - - (759)



Total comprehensive (loss)/income for the period

- (759) - 38,513 62,583 100,337
Transactions with owners:


Dividends paid

- - - - (45,494) (45,494)
Share options charged to income statement

- - 168 - - 168
Performance rights charged to income statement

- - 105 - - 105
Share options exercised

1,823 - (203) - - 1,620
Transfer for share options lapsed and forfeited

- - (373) - 373 -
Deferred tax on equity-based remuneration

- - 47 - - 47



Balance at 26 January 2020

60,752 (519) 841 66,251 184,794 312,119
Net profit attributable to shareholders for the period

- - - - 73,199 73,199
Other comprehensive income:


Change in value of investment in equity securities

- - - (92,174) - (92,174)
Net fair value loss taken through cashflow hedge reserve

- (1,938) - - - (1,938)



Total comprehensive (loss)/income for the period

- (1,938) - (92,174) 73,199 (20,913)
Transactions with owners:


Dividends paid

- - - - (33,370) (33,370)
Share options charged to income statement

- - - - - -
Performance rights charged to income statement

- - 183 - - 183
Share options exercised

1,087 - (168) - - 919
Transfer for share options lapsed and forfeited

- - (521) - 521 -
Deferred tax on equity-based remuneration

- - 109 - - 109
Balance at 31 January 2021

61,839 (2,457) 444 (25,923) 225,144 259,047

Earnings per Security (EPS)

Calculation of basic and fully diluted EPS in accordance with IAS 33: Earnings Per Share

Current full-year
(cents per share)
Previous corresponding full-year
(cents per share)
Basic EPS 32.9 28.2
Diluted EPS 32.8 28.0

Dividends Paid / Payable in relation to the year ended 31 January 2021

Date Paid / To be paid Cents per share (fully imputed)
Interim Dividend for the period ended
31 January 2021
1 October 2020 9.00
Special Dividend for the period ended
31 January 2021
20 January 2021 6.00
Final Dividend for the period ended
31 January 2021
31 March 2021 13.50

Segment Information




For the period ended
31 January 2021

Homeware

$000


Sporting goods

$000

Eliminations /
Unallocated
$000


Total Group

$000

Sales Revenue


439,234

262,563

701,797


Earnings Before Interest
and tax



66,979

46,495

2,412

115,886





For the period ended
26 January 2020

Homeware

$000


Sporting Goods

$000


Eliminations /
Unallocated
$000


Total Group

$000


Sales Revenue


410,908

242,109

653,017


Earnings Before Interest
and tax



49,390

36,447

11,386

97,223

---

Distribution Notice

Updated as at 18 December 2019



Please note: all cash amounts in this form should be provided to 8 decimal places

Section 1: Issuer information
Name of issuer Briscoe Group Limited
Financial product name/description Ordinary Shares
NZX ticker code BGP
ISIN (If unknown, check on NZX
website)
NZBGRE0001S4
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year X Quarterly
Half Year Special
DRP applies
Record date 24/03/2021
Ex-Date (one business day before the
Record Date)
23/03/2021
Payment date (and allotment date for
DRP)
31/03/2021
Total monies associated with the
distribution
1

$ 30,032,910.00000000
Source of distribution (for example,
retained earnings)
Retained Earnings
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution
2
$0.18750000
Gross taxable amount
3
$0.18750000
Total cash distribution
4
$0.13500000
Excluded amount (applicable to listed
PIEs)
$-
Supplementary distribution amount $0.02382353
Section 3: Imputation credits and Resident Withholding Tax
5

Is the distribution imputed Fully imputed X
Partial imputation
No imputation

1
Continuous issuers should indicate that this is based on the number of units on issue at the date of the form
2
“Gross distribution” is the total cash distribution plus the amount of imputation credits, per financial product, before the deduction of
Resident Withholding Tax (RWT).
3
“Gross taxable amount” is the gross distribution minus any excluded income.
4
“Total cash distribution” is the cash distribution excluding imputation credits, per financial product, before the deduction of RWT.
This should include any excluded amounts, where applicable to listed PIEs.
5
The imputation credits plus the RWT amount is 33% of the gross taxable amount for the purposes of this form. If the distribution is
fully imputed the imputation credits will be 28% of the gross taxable amount with remaining 5% being RWT. This does not constitute
advice as to whether or not RWT needs to be withheld.

If fully or partially imputed, please
state imputation rate as % applied
6

28%
Imputation tax credits per financial
product
$0.05250000
Resident Withholding Tax per
financial product
$0.00937500
Section 4: Distribution re-investment plan (if applicable)
DRP % discount (if any)
%
Start date and end date for
determining market price for DRP

Date strike price to be announced (if
not available at this time)

Specify source of financial products to
be issued under DRP programme
(new issue or to be bought on market)

DRP strike price per financial product
$
Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms

Section 5: Authority for this announcement
Name of person

authorised to make
this announcement
Geoff Scowcroft
Contact person for this
announcement
Geoff Scowcroft
Contact phone number +64 9 815 5678
Contact email address geoff@briscoes.co.nz
Date of release through MAP

16/03/2021





6
Calculated as (imputation credits/gross taxable amount) x 100. Fully imputed dividends will be 28% as a % rate applied.

---

Full Year
31 January, 2021
RETAIL
IS OUR
WORLD.

Contents

FY January 2021 Highlights

Sales Growth

Gross Profit Growth

Net Profit After Tax

Strategy Update

How We Will Continue To Win

FY January 2021
Highlights
Record sales across all channels
Group sales +7.47% to $701.8m
Homeware sales +6.89% to $439.2m
Sporting goods sales +8.45% to $262.6m
Group online sales +79.65% (18.81% of Group Sales)
Omni strategy delivery
Online sales 18.82% of total sales
Nationwide online fulfilment capability enhanced significantly
Click and Collect established early 2020 across all stores
Strong gross margin performance
Gross margin % up 433bps to 43.76%
Focus on margin enhancement across all
stages of product life cycle
Record NPAT
NPAT up 16.96% to $73.2m
Excellent cash generation
Net cash at period end of $100.4m
6.00 cents per share special dividend paid January 2021
13.50 cents per share final dividend declared
Managing our response to Covid-19
Health and wellbeing of team and customers our top priority
Accelerated our strategic initiative programme already underway
All team paid in full throughout lockdowns
No redundancies or permanent store closures
$11.5m Government Wage Subsidy repaid in full

Sales Growth
Group Sales ($ million)Group Sales by Channel
85.2% of total sales involve
a customer visiting a store
2017/18
385
220
605
2018/19
403
632
229
2019/20
411
653
242
2020/21
439
702
263
20%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
$800.0
$600.0
$400.0
$200.0
$0.0
8.2%
10.0%
11.3%
18.8%
HomewaresSporting
Goods
BGP - Group
Online Mix
4.0%
14.8%
81.2%
ONLINE
SALES
% OF TOTAL
ONLINE SALES
H1H2FY
HOME
DELIVERY
91%
9%
70%
30%
80%
20%
CLICK &
COLLECT

Strong increase in margin across both homeware and sporting goods
Focus on margin enhancement across all stages of product life cycle
• Optimise pre-season planning and buying processes
• Use of enhanced data analytics to maximise seasonal trading events
• Improve inventory flow to shelf for new and replenishment product
• Reduce level of clearance product
Gross Profit %
2017/182018/19
37.0 %
38.0%
39.0%
40.0%
41.0%
42.0%
43.0%
44.0%
45.0%
40.0%40.0%
39.9%
40.2%
40.1%
39.9%
39.5%
39.3%
39.4%
43.8%43.8%
43.7%
2019/202020/21
Homewares
Sporting
Goods
BGP

Net Profit After Tax
($ million)
2020/21 NPAT up 16.96% to $73.2m
$11.5 Government Wage Subsidy repaid in full
No Kathmandu dividend received during 2020/21 (Last year $6.8m)
Focus on inventory, costs and internal processes
61. 3
2017/18
63.4
2018/19
62.6
2019/20
73.2
2020/21
40
80
60
70
50

CUSTOMER
2020/21 Achievement
Completion of enhanced online platform.
Accelerated nationwide roll-out of Click and Collect.
Creation of customer segmentation analytics.
Providing a deeper understanding of customer
behaviour.
Increased customer satisfaction levels, Briscoes
up to 75 (up 1.2 on Ly) and Rebel 63 (up 3.8 on Ly)
Active customer base increase of over 20%.
Further nationwide expansion of our Online order
fulfilment – delivering over 1 .5m customer parcels.
Optimisation of our online picking process.
Embedded the strategic partnership with KPMG.
Completed the software development for
extended online product ranging.
Optimised delivery fee profile.
Key focus for 2021/22
Deliver mobile solutions for store team members
and reinvest time to increase customer service
levels.
Increased speed of development for customer
experience enhancements both in-store and online.
Launch of new automated email CRM
automation tool.
Enhanced data analytics capability to increase
product availability.
Optimised supply chain efficiency to reduce split
parcels and optimise online profitability.
Complete future DC network modelling analysis.
Leverage DTC capability to test new incremental
product categories online and in store.
Proactively reviewing new retail brand
opportunities.
ATTRACT
RETAIN
GROW
FUTURE
SUPPLY
CHAIN
NEW
REVENUES
Strategy Update
– Projects on track and delivering to plan

How We Will Continue To Win

Retail brands appealing to a wider range of customers. Global leading branded offer,
providing quality, value and style.

Strong trading performance across Homewares and Sporting goods

High performing Leadership team and strong team engagement

Digital growth accelerated by new platform and increased internal resource

Strong Balance sheet and Cash position to fund strategic investment

Strategic programs defined and embedded over past 12 months.

Strong partnership with KPMG with a shared focus of value creation

Shared values, strong strategic relationships and a commitment to continue to do the right thing
for the long term growth for all our stakeholders.