The Beacon Lighting Group Ltd (ASX: BLX) share price is beaming today after the retailer announced bumper second-half sales growth.
At the time of writing, Beacon Lighting shares have surged 22.61% to $1.22, taking the company's year-to-date share price movement back into positive territory (albeit marginally).
What did Beacon Lighting announce?
This morning, Beacon Lighting delivered a business update. This is the first time investors have heard from the company since the release of its first-half FY20 results back in February.
In today's release, Beacon revealed that its stores have been able to trade throughout the COVID-19 pandemic. This has helped the company to achieve strong sales growth in the second half of FY20.
Accordingly, for the period 30 December 2019 to 14 June 2020, Beacon delivered total sales growth of 15.5% and comparable sales growth of 16.9% over the corresponding period in 2H19. Meanwhile, the company's online channel reported bumper growth of 77.7%.
As for year-to-date results (1 July 2019 to 14 June 2020), Beacon has achieved total sales growth of 7.1%, comparable sales growth of 6.4%, and online sales growth of 47.8% over the corresponding period in FY19.
The company attributed this uplift in sales to changes in consumer behaviour in the wake of COVID-19.
Further developments and profit guidance
On 9 December 2019, Beacon disclosed it had sold its Brisbane distribution centre to Charter Hall for $28 million under a sale and leaseback arrangement.
This morning, Beacon revealed that the sale realised a cash flow profit before tax of $13.5 million. Given the sale and leaseback accounting rules, the company realised a profit before tax of $7.8 million which will contribute to its FY20 statutory results.
At the end of last year, the company also announced the closure of Beacon Energy Solutions. The retailer disclosed today that the cost to close the business will be approximately $5 million, exceeding original forecasts of between $3.4 million and $3.9 million.
Excluding the impact of the distribution centre sale, the Beacon Energy Solutions closure and lease accounting changes, the company's FY20 underlying net profit after tax (NPAT) is expected to exceed the $16.5 million result achieved in FY19.
