Super Retail Group plans to raise $203 million to help grow its omnichannel business following a 126.2 per cent growth in online sales across its Supercheap Auto, Rebel Sport, and BCF chains and brands.
The Group, which owns and operates the Supercheap Auto, Rebel, Macpac and BCF retail chains, is issuing approximately 28.2 million new shares to raise $203 million to create new opportunities as a result of the disruption caused by COVID-19.
In an announcement to investors on Monday June 15, the company stated in a trading update that the Group saw a 26.2 per cent decline in like-for-like sales in April, which was followed by a rebound in May sales of 26.5 per cent.
“During April and May, there was a strong shift to online with Group online sales increasing 126.2 per cent vs. the previous corresponding period (pcp) to represent 18.2 per cent of Group sales over the same period,” the company said in Monday’s statement.
The group said sales growth has continued to benefit from a strong consumer environment in June as coronavirus lockdowns continue to ease, led by the Supercheap Auto, Rebel, and BCF brands. Macpac was hurt by the NZ government-imposed lockdowns.
The company credited the strong performance to its recent investment in its omni-retail platform and supply chain, which enabled it to meet the significant shift to online and click-and-collect purchasing.
“The Group has also repurposed costs to areas of high activity to meet customer demand,” the company stated.
In addition, the Group has undertaken a number of actions to support its omni-retail strategy including an acceleration of the migration to cloud-based platforms and an optimisation of the support office functions and store network.
Anthony Heraghty, Super Retail Group CEO said he was pleased with the company’s trading performance during COVID-19.
“The execution of our strategy has continued during COVID-19, with our four core brands well positioned to take advantage of shifts in consumer behaviour that have been observed through the pandemic,” he said.
“The equity raising enables us to continue the execution of our strategy, further strengthen our omni-retail capabilities and continue to organically grow our four core brands.”
Throughout COVID-19, the Company’s omni-channel business strategy included leveraging customer behavioural analytics and insights to inform new COVID-19-specific campaign activity.
“We leveraged our distribution centres’ assets to service significant on-line order demand and resourced our Customer Contact Centre to support customer requirements,” the company stated.
The Group implemented contact-free click & collect across all Australian standalone stores and shifted from catalogues to digital campaigns and maintained customer activity throughout.
“While there is an uncertain economic environment ahead, the Group’s core four brands are well positioned to take advantage of consumer trends emerging from COVID-19, including a material shift to on-line purchasing, the trend towards home-based fitness and leisure, and increasing domestic tourism and leisure activities,” the Group stated.
The Group is announcing an underwritten 1 for 7 accelerated pro rata non-renounceable entitlement offer to raise approximately $203m at a fixed price of $7.19 per share.
“The Equity Raising will enable Super Retail Group to continue to execute its strategy and pursue strategic growth initiatives, allowing the Company to position the business to take advantage of changing consumer trends by returning capital expenditure to historic levels of c.$90m per annum, even if a softer trading environment emerges,” the Group stated.
Investments are expected to include omni-retail digital customer experience and analytics and supply chain to facilitate omnichannel sales growth.