Source: Radio New Zealand
The Warehouse is owned by The Warehouse Group. SUPPLIED
The Warehouse Group’s shareholders have peppered the board and executives with pointed questions and criticism about several years of under-performance at this morning’s annual meeting.
Outgoing chair Dame Joan Withers said the past few years had been difficult for shareholders, but a refreshed executive team had hit the ground running with a sharpened focus on controlling costs and driving growth.
The first quarter of the current year ending in July saw a near 1 percent gain in sales, though group profit margins remained under pressure, dragged down by Red Sheds, while Noel Leeming and Stationery saw some improvement.
Chief executive Mark Stirton said trading conditions were still challenging, though customers were responding to new product ranges, with an increase in foot traffic.
“It is clear to me that our competitive advantage lies in our stores, footprint and in our footfall,” he said.
“We have the highest number of stores of any New Zealand general retailer, with 1.7 million customers walking through our doors every week.
“It is within our gift to show up for these communities and customers better than we have to date.”
The company previously announced it would cut an undisclosed number of jobs in its head office, but not at the front line, where hundreds of jobs were shed in recent years.
Still, the value of its shares had dropped more than 25 percent over the past 52 weeks, with another 1 percent drop as the meeting dragged on.
Dame Joan spent a good part of the meeting acknowledging the failure of the business to deliver profit growth and shareholder value over her tenure.
“We’ve been through the history of what’s happened over the last few years a lot, and analysed what we did,” she said.
“We focused on an ecosystem strategy. We believed that with Amazon going into Australia, there was a massive threat, and we had to have a platform.
“We were told it was existentially important to us. If we’re honest, we took our eye off the ball a little bit in terms of the store environment.”
She said both incoming chair John Journee, who had acted as interim chief executive until Stirton was appointed in May, were focused on getting the fundamentals right.
“As Mark has said, it’s the gross profit margin that remains under pressure, and that we’re addressing, and that we obviously know that we need to improve our bottom line profitability, and we’re totally focused on doing that.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
