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Kirkcaldie & Stains’ unprofitable streak continues as it posts half-year loss

  • News
  • April 29, 2015
  • Elly Strang
Kirkcaldie & Stains’ unprofitable streak continues as it posts half-year loss
Kirkcaldie & Stains

The store has faced hardships felt by many retailers around the country, as the growth in shopping online has hurt its in store sales.

Total revenue fell from $19.4 million to $17.5 million.

Despite the December period being included in the half year, which usually provides a boost to results, retail sales fell 0.6 percent to $16.9 million.

Kirkcaldie & Stains made small changes to its store in 2014 by adding Jo Malone perfume, skincare and healthcare to its cosmetics department, and opening up a concession selling George Jensen Living and Alessi homeware.

Both had been well received and the company made a good start to the year, but February’s retail sales disappointed.

Kirkcaldie & Stains’ dismal financial performance was due to the directors deciding to write down a deferred tax asset of $531,000, the company said.

Retail operations made a pre-tax profit of $145,000. Last year retail operations made a profit of $231,000.

The company has recently endured some turbulent times.

Last year’s profit ending February 28 wasn’t sizeable, as it made $563,000.

It reported a net loss of $6.5 million in August and had to sell its Harbour City Centre building for $45.85 million to pay off various write-downs, as well as $23.5 million in bank debt.

John Milford, its CEO of eight years, resigned in December. Former managing director Philip Shewell stepped up as acting CEO.

Kirkcaldie & Stains said it was looking at three options to return the business to profitability: a focus on retail turnaround, which it predicted would take three to five years; investment; divesting the business altogether or downsizing.

It said it wouldn’t make a decision on a new CEO’s appointment until it has figured out which direction to take the business in.

“The strategic review of retail operations likewise continues and it remains the main focus of the Board for the coming months,” it said.

The retailer will now be relying on strong winter trading season to lift its annual result.

Its shares last traded at $1.68, coming down from a high of $2.49 in May last year.

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