Mosaic Brands is expecting a 50% lift in net profit after tax (NPAT) in the first half of FY24.
This is despite absorbing an estimated negative impact of $4.3 million due to an adverse currency movement against the US dollar.
The Australian fashion retail group is expecting a $2 million lift in NPAT to $5.9 million. Earnings before interest and tax (EBIT) is expected to be around $10.6 million, against $11.95 million in the prior corresponding period.
Mosaic’s in-store only comparable sales were negative 6.6% in the first half of FY24 compared to FY23 and up 8.5% on FY22 on a 33% stock reduction in H1 FY24.
Mosaic Brands - which operates retailers such as Millers, Noni B and Rockmans - has recorded a circa $11.6 million improvement in its balance sheet net current asset position.
“Having returned the group to post-Covid profit in FY23, as set out at the AGM in November, our priority is on improving our balance sheet in FY24 as the final step of our turnaround,” CEO Scott Evans said.
“That saw us take a front foot approach on stock management for the first half and negotiating an improved cost price for goods looking to the next 12 months.”
“Against a backdrop of reducing our stock purchases by 33% for the first half, achieving an in-store decline of just 6.6% highlighted that our customers are reacting to our new ranges exceptionally well.
“We’ll now lift stock intake from March for the second half on the back of some of the most favourable inventory costs the Group has achieved in its history.”