Universal Store Holdings Reports Strong Second-Half Sales Rebound

Highlights:

• Sales Rebound: Universal Store Holdings reported a 9.7% increase in total sales, reaching AU$288.5 million, driven by a strong second-half recovery and successful US market entry.
• Earnings Surge: The company’s underlying EBIT grew by double digits to AU$47.1 million, with statutory net profit up 45.3% to AU$34.3 million, supported by improved cost management.
• Dividend Growth: Universal Store Holdings declared a fully franked final dividend of 19 cents per share, contributing to a 63% increase in total dividends for the year.

Sales Surge Driven by US Expansion

Universal Store Holdings (ASX: UNI), a leading specialty youth fashion retailer, has reported a robust sales performance in the second half of the 2024-23 financial year, with total sales reaching AU$288.5 million, marking a 9.7% increase. This significant rebound was fueled by the company’s successful entry into the US market and the introduction of innovative retail formats.

Earnings and Profit Growth

The company's underlying earnings before interest and taxes (EBIT) surged by double digits, reaching AU$47.1 million. Additionally, statutory net profit experienced a remarkable increase of 45.3%, climbing to AU$34.3 million for the year ending June 30, 2024. This impressive growth was attributed to better cost management and operational efficiency. Despite a slight 0.3% decline in comparable sales over the entire year, Universal Store Holdings saw a strong recovery in the second half, with a 6.6% increase due to strategic refinements in its product range.

Dividend and Future Outlook

The company declared a fully franked final dividend of 19 cents per share, bringing the total dividends for the year to 35.5 cents, reflecting a substantial 63% increase from the previous year. At the end of the financial year, Universal Store Holdings operated 102 physical stores, including 80 Universal Store sites, 14 Perfect Stranger locations, and eight THRILLS stores.

CEO Alice Barbery highlighted the positive momentum continuing into the new financial year, with sales in US stores up by 15.3% in the first seven weeks. Like-for-like growth also showed a strong 12.5% increase, building on a weaker trading period last year. Perfect Stranger, in particular, has seen impressive growth, with sales up nearly 90% so far this year. The company also reported double-digit growth in like-for-like sales and direct-to-consumer channels, further solidifying its market position.

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