Coronavirus lockdown boosts Beacon Lighting sales

A sales burst has prompted an upbeat trading performance for Beacon Lighting as consumers complete home projects.

Beacon Lighting says it has experienced significant growth in sales in the second half.

The boss of Beacon Lighting is banking on Australians stuck at home and unable to go abroad turning their attention, and disposable income, to sprucing up their homes with new lighting products as well as new desk lamps or ceiling fans for home ­offices.

And a portion of the sales bonanza could be fuelled by people grabbing $10,000 in early release funds from superannuation and deciding it was better invested in their homes than on the volatile sharemarket.

Unveiling a trading update on Wednesday that showed a bounce in sales and that triggered a leap of almost 25 per cent in its share price, chief executive Glen Robinson said growth in sales was across the board.

“Much of it (rising sales) is coming from the fact people are not spending in cafes and restaurants, they are not going on overseas holidays, so they are investing in their house,’’ Mr Robinson told The Australian.

“Some of it might be coming out of superannuation money, and they see it as a good opportunity to improve the value of their home and change their spending habits from where they would usually go.”

Shares in Beacon Lighting surged following the release of the trading update and a profit upgrade, rising almost 25 per cent, and later closing up 21.6 per cent at $1.21.

For the second half through to June 14, Beacon achieved sales growth of 15.5 per cent and online sales growth of 77.7 per cent.

For the financial year to date Beacon has achieved total sales growth of 7.1 per cent, like-for-like sales growth of 6.4 per cent and online growth of 47.8 per cent.

“It is across the board so there has been an uplift. Probably the strongest growth categories were light globes, desk lamps that sort of stuff … even things like ceiling fans, garden lighting was very popular,’’ Mr Robinson said.

However, the company said due to changes in customer shopping patterns and future changes in government policies, it was unable to say whether the higher sales would continue.

Despite this caveat, Beacon said underlying net profit in the 2020 fiscal year would exceed the $16.5m achieved in 2019.

In a trading update in December, Beacon Lighting announced the Parkinson Distribution Centre sale and the Beacon Energy Solutions closure. The Parkinson Distribution Centre was sold for $28m, which realised a profit before tax of $13.5m. Given the sale and leaseback accounting rules, the group realised a profit before tax of $7.8m in the 2020 fiscal year’s statutory result.