The Warehouse Group FY24 First Quarter Sales Update

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The Warehouse Group – FY24 Q1 trading update
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Auckland, 14 November 2023

The Warehouse Group (“the Group”) has today provided a trading update for the 13 weeks ending 29
October 2023 (“FY24 Q1”).
The Group reported total sales of $713.3 million in FY24 Q1, a decline of 6.7% compared to the same
period in FY23 Q1.
• The Warehouse sales were $394.2 million, down 4.9% compared to the same period last year.
• Warehouse Stationery sales were $54.6 million, down 4.0% compared to the same period last
year.
• Noel Leeming sales were $234.1 million, down 5.1% compared to the same period last year.
• Torpedo7 sales were $27.9 million, down 25.4% compared to the same period last year.
The prior year period of FY23 Q1 saw strong sales across all brands following the easing of COVID-19
restrictions, with record The Warehouse sales growth of 39.0% and Group sales growth of 21.2% in
FY23 Q1 compared to FY22 Q1. FY23 Q1 was always going to be an impressive performance to follow
and in FY24 Q1 we have seen sales decline compared to prior year across all our brands.
Group gross profit was $243.4 million in FY24 Q1, down 1.6% compared to FY23 Q1. Group gross
profit margin saw an improvement of 180 basis points year on year, increasing from 32.3% in FY23 Q1
to 34.1% in FY24 Q1, as a result of improvement in the management of Cost Of Goods Sold (“COGS”).
The Warehouse experienced sales decline of 4.9% to $394.2 million in FY24 Q1. Category strength in
grocery sales continued, increasing 8.2% in FY24 Q1 compared to FY23 Q1, and making up 22.8% of
The Warehouse sales in FY24 Q1. In addition to grocery, we also saw a strong increase in audio visual
and television category sales, but offset by a decline in homeware and apparel.
Warehouse Stationery sales declined 4.0% to $54.6 million. Warehouse Stationery saw growth in
sales from our print & copy service offering and communication product category with customers
responding well to promotions of these services and products, but offset by softening demand for
tablets, tech accessories and print & consumables product categories sales.
Noel Leeming recorded sales of $234.1 million, down 5.1% compared to FY23 Q1. Noel Leeming sales
experienced early quarter decline in computers, whiteware and television categories, as customers’
discretionary spending was challenged in big ticket items. Partially offsetting this decline were
increased sales in communications and gaming categories, and pleasingly improved performance
across key categories later in the quarter.
Torpedo7 recorded sales of $27.9 million, down 25.4% compared to FY23 Q1. Torpedo7 continues to
pose a significant challenge for the Group. Bikes and riding apparel sales continued to follow the global
decline trend in this category. Weather has also impacted other sports categories including water
hardware and water apparel, but delivered sales growth in some product areas including snow sport
hardware and apparel due to the late snow season increasing demand in this category throughout Q1.

Torpedo7 sales were further impacted in the quarter due to ERP system replacement issues disrupting
online and instore sales.
Total Group foot traffic, adjusting for Warehouse Stationery stores moving to a SWAS, decreased
3.5% in FY24 Q1 compared to FY23 Q1, as customers’ spending continues to be more deliberate.
We have seen a continued normalisation of online sales, with these decreasing 6.5% in FY24 Q1
compared to FY23 Q1, and online sales as a percentage of total sales decreasing from 11.1% in FY23
Q1 to 8.4% in FY24 Q1
1
. This compares to online sales of 7.8% of total Group sales in FY20 Q1 being
the period prior to COVID-19
2
.
Across the industry, New Zealand core retail spend decreased 0.1% in the quarter ending 29 October
2023 compared to the same period last year, with The Warehouse core market share decreasing
slightly from 9.6% of core retail spend in FY23 Q1 to 9.1% in FY24 Q1.
Highlights for the quarter include opening new The Warehouse and Noel Leeming stores in Wanaka
on 12 October 2023 and expanding our fresh fruit and vegetables offering at The Warehouse to 22
stores, up from 12 at year end.
The Warehouse Group CEO Nick Grayston said “It has been another challenging quarter for the Group
but overall, we are seeing some margin improvements across our main brands and good progress on
lowering our Group cost of doing business.
“Torpedo7 has not made the progress we’d hoped to see. We have a critical quarter ahead as we focus
on driving its business performance recovery.”
Outlook
“Trading conditions for the important second quarter remain uncertain, with a new incoming
Government, interest rates remaining high and cost of living challenges.
“We remain committed to providing our customers with value while managing our costs to drive
profitable results. Looking ahead, we are well positioned as we move into our biggest quarter including
Black Friday, Christmas trading, and our summer peak period with good levels of stock across all our
brands,” said Mr Grayston.
Dividends
At the FY23 Annual Results, the Board announced a fully imputed final dividend of 8.0 cents per share.
The record date for the FY23 final dividend is 16 November 2023 and will be paid on 1 December 2023.
2023 Annual Meeting
The Warehouse Group 2023 Annual Shareholders’ Meeting will be held on Friday 24 November 2023
at 10.00am (New Zealand time) at the Ellerslie Event Centre, Auckland, and online through the
Computershare meeting platform. Please refer to the Notice of Meeting which was sent to
shareholders and released to the NZX on 25 October 2023 for further information, including how to
participate online.
ENDS


1
Online Sales includes The Warehouse, Warehouse Stationery, Noel Leeming and Torpedo7 online and Gross
Merchandise Value (GMV) through TheMarket.com and Group Marketplace.
2
FY20 Q1 Online Sales excludes GMV through TheMarket.com and Group Marketplace as TheMarket.com was
launched on 1 August 2019 and GMV was not reported at that time.

Contact details regarding this announcement:

Investors and Analysts: Celia Mearns, Acting Chief Financial Officer
To be contacted via Kim Russell +64 21 452860
kim.russell@thewarehouse.co.nz

Media: Lizzie Havercroft, Corporate Affairs Partner
+64 27 5070613
Media.enquiries@thewarehousegroup.co.nz

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Quarterly Sales
Reporting Period 13 weeks to 29 October 2023
Previous Reporting Period (2023) 13 weeks to 30 October 2022
Quarterly Retail Sales information:
SalesSales
(31 July 2023 to 29 October 2023)
20242023
($ Million) ($ Million)
The Warehouse
394.2 414.6
- 4.9 %
Warehouse Stationery54.6 56.9
- 4.0 %
Noel Leeming234.1 246.6
- 5.1 %
Torpedo727.9 37.4
- 25.4 %
Total Group
1
713.3 764.7
- 6.7 %
Store Numbers
20242023202420232024202320242023
Start Quarter 1
888967 68 66 68 25 24
End Quarter 1
888867 68 66 68 25 24
20242023202420232024202320242023
Start Quarter 1
472,358 479,900 84,186 83,064 50,203 56,638 35,953 31,200
End Quarter 1
469,818 473,359 83,815 83,064 49,031 52,452 35,953 31,200
1 - 1 -
1 1 1 -
1 - 1 -
- - - -
Note:
The Warehouse
Warehouse Stationery
Noel Leeming
Torpedo7
1) Total Group sales includes TheMarket, eliminations and other Group operations in addition to the 4 main retail operations detailed above.
Store changes during the quarter
New
store
Replacement
store
Store
closure
Store
extension/
reduction
The WarehouseNoel Leeming
Warehouse StationeryTorpedo7
Store footprint
(Square Metres)
The WarehouseNoel Leeming
Warehouse StationeryTorpedo7
The Warehouse Group Limited
First quarter sales
Change in
sales