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Tag: Smiths

  • Smiths City puts off capital return again

    Smiths City puts off capital return again

    Smiths City Group has delayed a planned $5.7 million capital return to shareholders a second time as increasingly tight trading conditions prompted the retail chain to downgrade its first-half earnings outlook.

    Christchurch-based Smiths City won’t consider the capital return until 2018 as stiff competition and the need for more investment in its transformation programme led the board to maintain a more conservative capital structure.

    The retailer already delayed plans to pay 72 cents per share in a compulsory acquisition and cancellation of three shares in every 20 over outstanding regulatory issues, having first floated the return in June.

    The retail environment has attracted strong competition, especially in consumer electronics, digital products, and whiteware.

    Smiths City said revenue will likely fall 3 per cent in the six months ending October 31 from the $113.9 million reported a year earlier, implying first-half sales of about $110.5 million.

    “We expect group profitability to be lower than the same six months last year, with a weaker retail performance partially offset by a strong performance from our finance operations,” chair Craig Boyce said in a statement.

    “In the face of these challenges, it is appropriate the company maintains a more conservative level of gearing. The Smiths City board has resolved to review the position during the 2018 calendar year.”

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  • Furniture retailer’s share buyback delayed

    Furniture retailer’s share buyback delayed

    Smiths City Group shareholders won’t vote on a $5.7 million capital return at this month’s annual meeting as the retail chain operator works through outstanding regulatory matters.

    The Christchurch-based company had planned to put forward a planned share buyback to investors at the August 21 annual meeting, but will now have to hold a special meeting later this year as it irons out the details of the deal.

    Smiths City plans to pay 72c a share in a compulsory acquisition and cancellation of three shares in every 20, provided it gets approval from the High Court, Inland Revenue, lender ASB Bank and shareholders.

    “The return of capital was not referred to in the notice of meeting as the company is still attending to some regulatory matters that need to be dealt with prior to putting the return of capital to the shareholders of the company for their approval,” chairman Craig Boyce said in a statement.

    “The company’s intention is to put the matter to shareholders for approval at an extraordinary general meeting later in the year.”

    The retailer is partway through a five-year transformation programme where it wants to quit low margin businesses and expand its Auckland presence.

    In June it reported a 54 per cent jump in underlying earnings to $2m on largely flat revenue $227.5m on a smaller restructuring bill.

    The shares recently traded at 71c and have increased 2.9 per cent so far this year.

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