RCG Corporation reported a profit increase of 13.8 per cent, from $5.96 to $6.78 million during the first half of the 2013 financial year.
This figure does not account for the losses associated with the now defunct Shoe Superstore brand, which was placed into voluntary administration earlier this month.
Hilton Brett, CEO, RCG Corporation said “we are extremely pleased with the performance of our ongoing businesses and could not have hoped for better results in the current climate.
“At the same time we are very disappointed that, despite every effort, Shoe Superstore continued to trade below expectations.”
He said the brand’s poor performance is reflective of changing consumer habits, particularly as its core customer base is now less likely to purchase items they do not necessarily need.
“We do not see these trends reversing in the foreseeable future, as a result of which we do not believe the Shoe Superstore business to be viable in the long_term,” said Brett.
In the first half of the 2013 financial year Shoe Superstore reported a loss after tax of $0.007 million. In comparison, for the same period last year, the company’s profit was $4.02 million.
The Athlete’s Foot recorded a $92.42 million profit for the period, which is 6.7 per cent higher than the same period last year.
Like-for-like sales increased by 8.2 per cent, from $82.26 to $88.96 million in the first half of the financial year, and figures show they are up 6.1 per cent on the previous year for the first 7.5 months up to mid-February.
Brett said, “we are delighted with the performance of the TAF business which continues to grow and thrive despite the challenges that have faced some Australian footwear retailers over the recent past.
“The resilience of the business continues to be a great testament to the focus, dedication and skill of TAF’s franchisees, management and staff.
“The continued outstanding performance of TAF continues to be a major focus of the senior management team,” he said.
RCG’s wholesale and distribution division, which encompasses Merrel, CAT, Chaco and Cushes Footwear also performed well during the period.
The four brands collective sales increased by 43 per cent, from $11.45 to $16.38 million and wholesale sales grew by 27.7 per cent to $13.89 million, meanwhile retail sales increased by 335 per cent to $2.45 million.
Brett said he was pleased with the performance of the company’s RCG brands.
“We continue to drive growth out of both our Merrell and CAT wholesale businesses and we are delighted with the performance of in our branded retail stores”.
The company opened three new Merrell stores during the period, bringing its total number of stores to six.
In conclusion, Brett said “although our decision with regard to Shoe Superstore was a difficult one to make, we are absolutely convinced that it is in the long term best interest of the RCG business to have done so.
“We are left with two outstanding, growing and profitable business units and the senior management team is now able to turn its attention in earnest to leveraging the business’s competencies and strong balance sheet to identifying and capitalising on meaningful growth opportunities,” he added.