Beacon shoots out the lights with bumper profit

Beacon Lighting turns on a stellar profit rise as home renovations boom, helped by customers’ unfamiliarity with its products.

Joe Hughes, at Beacon Lighting. Picture: Rob Leeson.

Bricks and mortar is not dead at Beacon Lighting Group, which delivered a glowing profit result on the back of COVID customers locked at home across Australia and overseas.

The lighting and cooling retailer switched on with a 132.8 per cent rise in first-half net profit

of $22.2m.

Bumper sales from the lighting retailer’s bricks-and-mortar empire, coupled with a continuation of building and renovation activity throughout the pandemic lockdowns, kept the cash register ticking over.

People wanted new lights and were prepared to pay, with Beacon admitting many customers’ unfamiliarity with pricing on lights would “continue to improve our gross margins”, according to CFO David Spiers.

“Most people don’t know the price of lighting products because they shop infrequently,” he said.

Sales across the business increased 23.5 per cent to $151.3m, and were strong enough that the retailer never once resorted to taking JobKeeper payments.

Its online sales shone, growing 111.1 per cent to $14.4m, and now represent almost one in 10 of company store sales across the Beacon Lighting Group.

Despite the big boom in online sales the lighting company sees its future in bricks and mortar, with the retailer becoming a major landlord as it makes property purchases.

Beacon recently acquired sites in Molendinar, on the Gold Coast in Queensland, and Traralgon, in regional Victoria.

The business is looking at 69 new store opportunities over the coming years. 

The group is banking on a wave of new builders, buyers and renovators to drive continued sales growth across the suburbs and regions.

A Beacon Lighting store in NSW

Executive chairman Ian Robinson said Beacon would reap a COVID dividend from a nation denied an overseas holiday.

“The year has seen a new found love for the home a redirection of spending on the overseas holiday,” he said.

“It has resulted in an unprecedented take up of new lighting and cooling products.”

Gross profit leapt to $103.6m, helped by a strengthening Australian dollar.

The retailer also shifted to early opening hours in an attempt to gain a bigger slice of the tradie market, and this helped trade club customer sales jump 50 per cent in the first half.

Beacon’s trade club now has at least 39,800 customers, up almost 7000 from December 2019.

A fully franked dividend of 4.2 cents will be paid for the first half of the financial year.

The sharemarket welcomed the results, boosting Beacon’s price 1.1 per cent to $1.84 by close.