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High Risk Security Camera Seller Office Works Lifts Revenues Profits Flat

Officeworks who are benefitting from the higher margins of high-risk security cameras from a Company banned in several Countries has reported a modest 1.8% growth in the last Q3 quarter.

Sales grew 1.8% to $1,673M a big contributor was stationery, art, education, print & create and technology despite a fall in notebook and PC demand.

Also, down in the period was demand for mobile phones.

Also contributing to the growth was the opening of three new stores, with online sales growing 34.7% this included their Click & Collect sales.

The business had earnings growth of 1.2% with a profit of $86m with the business claiming that they had a strong Black Friday.

EBIT growth was 4.4%.

Unlike other Wesfarmers entities, Bunnings, and Kmart the return on capital was significantly lower at just 18.3%.

Late last year Officeworks started selling Chinese EZIVIZ security cameras which are manufactured by a parent Company Hikvision who are banned in multiple Countries including Australia.

Identified as “high risk” Officeworks is selling 13 variations of these security cameras.

The Company has not said how much extra margin they make selling high risks cameras as opposed to cameras from Australian Company Swann or US Company Arlo.

A big contributor of late has been back to school sales which are in line with prior corresponding period, despite non-recurrence of NSW back-to-school voucher program.

Management claim that they aim to continue with the expansion of their house brand ranges which will be at the expense of local distributors who have supplied them in the past.


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