Australia's Nick Scali Ltd has reported its results for the year ended 30th June 2024, the period in which it acquired UK retail chain AHF (Fabb Furniture).
Group written sales orders for the year were (Aus) $454.2m and included Fabb Furniture UK written sales orders of $6.8m (7.5 weeks).
Group revenue for the year was $468.2m, which included $8.3m for Fabb Furniture.
Nick Scali says the UK acquisition added $3.3m to group operating expenses in H2, adding: “To fund the acquisition of Fabb Furniture and future investment in the UK, the group undertook an equity raising in April 2024. Proceeds of $54.8m, net of $1.2m of equity raise transaction costs, was received from the equity raise.
“Anthony Scali, CEO and MD of Nick Scali Ltd has committed to subscribe for a further $4m of equity at the placement price subject to shareholder approval at the October 2024 AGM. If approved, total net proceeds from the equity raise will be $58.8m.”
Since the acquisition, Rodney Orrock (previously CEO of Best & Less) was appointed to lead the UK growth strategy transformation, based full time in the UK.
Nick Scali’s product has been adapted to UK compliance, arriving into UK showrooms in September and store refurbishments are under way.
A total of 20 UK stores were added to the store network with the acquisition of Fabb Furniture. The long-term opportunity of growth in the UK store network has not yet been confirmed.
“Written sales orders are down, affected by a combination of tougher market conditions, longer lead times due to supply chain disruptions, and commencement of store refurbishments,” says Nick Scali of the UK business.
“Trading is expected to deteriorate further in the first half of FY25 as disruption increases due to store refurbishments and change in the product range.”
