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Mitre 10 pays biggest dividend in 17 years

NZ NewswireNZ Newswire 4/11/2016 Paul McBeth

Mitre 10 © Facebook/Mitre 10 New Zealand Mitre 10 Mitre 10 (New Zealand) paid shareholders their biggest dividend in at least 17 years as profit soared, thanks to a lower wage bill and as growing consumer demand drove up sales.

The Auckland-based company paid dividends of $5.8 million in the year ended June 30, up from $1.8m a year earlier, giving the biggest return since at least 1999, according to financial statements lodged with the Companies Office.

Mitre 10 posted a profit of $3.2m, up from just $106,000 in 2015 when it spent more on land and rent for future stores, with wholesale revenue rising 8.7 per cent to $766.9m.

Mitre 10's income from selling services to members rose 53 per cent to $15m and rental income almost doubled to $1.8m.

In a separate statement, Mitre 10 said network sales from its stores rose 9.4 per cent to $1.24b, implying margins for the 81 owner-operator stores maintained their gross margins at about 38 per cent.

"Our financials show Mitre 10 is doing extremely well in a competitive retail and trade environment," chief executive Neil Cowie said.

"We're extremely pleased with the overall growth and direction of the cooperative and have been in the process of implementing transformational changes in our business to ensure this success will continue."

New Zealand's booming property market has been a boon for hardware chains such as Mitre 10, Bunnings, Carters and the Fletcher Building-owned Placemakers, driving demand for building, hardware and garden supplies.

Government figures show retail spending on those products rose 10 per cent to $6.74 billion in the year ended June 30, or 8.6 per cent when adjusted for inflation.

Stores owned by Mitre 10's board accounted for about $208.8 million, or 27.2 per cent, of the company's sales, up from $181 million, or 25.5 per cent, a year earlier.

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