Woolworths Group’s (ASX: WOW) move to refresh the Dick Smith brand has seen the retail chain gain highly profitable returns.
In the group’s half-year results, the Dick Smith component of the business earned a pre-tax profit increase of 28.5 per cent. The group claimed it resulted from recent efforts to refresh the chain.
The result is ahead of the Group’s overall performance - a modest pre-tax profit gain of 11.1 per cent.
In a statement, the group said growth was expected to continue into the next half of the year.
The total pre-tax profit of Woolworths Group's consumer electronics business reached $34.8 million and sales grew by 4.3 per cent to $710 million in the half-year.
Woolworths Group has undertaken a number of initiatives to grow the Dick Smith brand in Australia. The retailer has now refreshed 107 stores, with another 47 to be refreshed by the end of the financial year.
As part of the refresh, the group relaunched its website in late 2009, made investments in staff training and has new logos and signage.
Nine new Dick Smith stores were opened during the half, but 14 Dick Smith and Tandy stores were closed. The group maintains 362 stores nationally.
The retail group recently announced the construction of a consumer electronics distribution centre in Hoxton Park, Sydney. This should be finalised in the 2012 financial year.
The retailer also decided to phase out its reseller business in August 2009,. About 30 regional resellers were affected.