0012 GMT - Super Retail's Supercheap Auto business is to blame for a 14% drop in its stock price today. Supercheap Auto's pretax margin contracted by 150 basis points to 12.6% in 1H, which management attributed to rising labor costs and rents along with efforts to add new stores. Like-for-like sales at Supercheap Auto fell by 0.1% in 1H and are flat in the first seven weeks of 2H. Citi analyst Adrian Lemme says Supercheap Auto's 1H EBIT missed consensus estimates by 9%, taking the shine off some strong performances by Super Retail's other businesses. "The miss in Auto is the most concerning part of the result, in our view," says Citi, which rates Super Retail a buy. "However, we see signs of improvement in 2H momentum across all brands, which is encouraging." (david.winning@wsj.com; @dwinningWSJ)
(END) Dow Jones Newswires
February 19, 2025 19:12 ET (00:12 GMT)
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