The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Super Value’s owner yesterday said its three-week Christmas period “didn’t measure up to last year”, with total sales revenues down around 5 per cent year-over-year.

Rupert Roberts told Tribune Business that while the supermarket chain’s top-line initially appeared flat for 2015 Christmas and New Year period, that was before nearly $1 million in Value-Added Tax (VAT) had to be deducted for payment to the Government.

Explaining that Super Value took the week before Christmas, Christmas week and the week after Christmas into its festive calculations, Mr Roberts said it “fell short by $994,000” of its 2014 performance for the period.

“You take the week before, which was very disappointing, the week of Christmas, which was very good, and the week of New Year’s Day just didn’t come through,” he told Tribune Business.

“Sales were very disappointing, so when you add the three weeks together, we didn’t measure up to last year.”

Prior to ‘backing out’ the VAT due to the Government, Mr Roberts said Super Value’s “cumulative sales were feeling the same” as 2014.

“We did approximately the same as last year, but [accounting for] VAT paid on our sales, we fell short by $994,000. That’s what we’ll have to pay out to the Government - approximately $1 million.

“If you add that figure to the Christmas sales, we made it, but we’re off because we don’t have that.”

The Super Value chief added that sales in the 2014 post-Christmas/New Year’s week received a major boost as consumers rushed to stock up on food and drink, and household, items prior to the implementation of 7.5 per cent VAT.

“Last year we were pumping stock up to beat VAT,” he recalled, “and this year consumers didn’t have the incentive to buy.

“Consumers didn’t have the incentive to save 7.5 per cent, so they didn’t shop to fill the pantry. Last year’s New Year’s we enjoyed some busy shopping, which we missed this New Year.”

Mr Roberts said he anticipated that most retailers suffered around a 5 per cent sales decrease over the same three-week period due to VAT’s impact on consumer disposable income and spending.

“I imagine it’s about a 5 per cent decrease in sales across the country,” he told Tribune Business. “We came very close to having a 5 per cent decrease for the three weeks.”

Mr Roberts previously revealed to Tribune Business that his Super Value and Quality Supermarkets chains saw a 12 per cent year-over-year sales decrease in the week prior to Christmas, but the second week produced a 7 per cent rise to leave them $500,000 ahead of 2014.

However, he now said: “The third week has dropped those figures, and put us close to 5 per cent behind. We missed by $994,000, and that’s the tax we collected from the public for the Government.

“The public think we had a bumper year, but cumulative sales show we didn’t.”

Still, Mr Roberts said “one ray of hope” was likely to be provided by January, given that sales were likely to be ahead of 2015 levels.

“We know we’re going to have a good January,” he added,”because last year, on the first day of January, we had technical problems and didn’t collect VAT on that day.

“We had to pay that, that $20,000 for VAT, to the Government ourselves, which this year we’re going to collect from the public. We know we have a little bump in profit to look forward to, which we didn’t have last year.”

Mr Roberts said January 2016 would further benefit from the absence of a pre-VAT stock up, which occurred in late 2014 and impacted the same month last year.

“Most merchants live for December, but December doesn’t mean anything in the food business,” he added. “It’s just another period.

“Christmas week you do 50 per cent more, the week after Christmas you do 50 per cent less. We did have a bumper first week in January with sales coming back, but that’s because last year everyone had stocked up their pantry because of VAT.”