The Warehouse Group (WHS) H1 2026 earnings summary

Executive summary

• Sales reached NZD 1.6 billion, up 0.3% year-over-year, with like-for-like same store sales up 0.5% and improved profitability despite a challenging retail environment.

• Operating profit rose 37.7% to NZD 26.9 million, driven by disciplined cost control and a leaner operating model.

• No interim dividend declared due to ongoing economic uncertainty and a focus on rebuilding shareholder value.

• New management and a brand-led operating model are in place, focusing on retail fundamentals.

• A cost reset and restructuring program was initiated in November 2025 to improve profitability.

Financial highlights

• Gross profit was NZD 520.5 million, with a gross margin of 32.3%, slightly down from the prior period due to clearance activity in Q1.

• Group operating profit increased 38% to NZD 27 million compared to NZD 20 million last year.

• Adjusted NPAT increased 67.1% to NZD 17.9 million; reported NPAT up 33.6% to NZD 15.7 million year-over-year.

• Free cash flow was NZD 3.1 million, a significant improvement from -NZD 45.2 million in the prior year.

• Net debt improved to NZD 93 million from NZD 96 million at FY 2025 year-end; normalized, the group would have been in a net cash position.

Outlook and guidance

• Sales in the first six weeks of H2 were down 0.2% year-over-year, reflecting a competitive and uncertain environment.

• Focus remains on margin recovery, cost reduction, inventory management, and disciplined capital expenditure.

• Cautious approach to H2 due to geopolitical risks, rising freight costs, and economic uncertainty.

• No price increases planned in the near term, but scenario planning is ongoing.

• The financial impact of global events cannot be reliably estimated at this time.