Image source: Mr Adi@Shutterstock

Highlights

  • Baby Bunting is an Australian specialty retailer of baby products that caters to parents-to-be and parents with children from newborne to three years of age
  • In the financial year 2024, the company targets to open five new stores in Australia and New Zealand
  • AustralianSuper and Bennelong Australian Equity Partners Pty. Ltd. have the highest stake in BBN with a shareholding of ~13.13% and ~9.11%, respectively

Baby Bunting Group Limited (ASX: BBN) is an Australian baby product retailer that offers products to parents-to-be and parents of children from newborns up to three years. The company has a presence across New Zealand and Australia.

During the first half of 2023 (1HFY23), BBN’s  store count increased to 69, compared to 64 stores in 1HFY22. While in FY23, seven new stores were opened. The opening of new stores assisted in revenue growth to the tune of 1.68% to AUD 515.80 million during the reported period.

Increased sales also drove revenue growth during the final three weeks of June, as customers responded positively to promotional activities.

BBN’s pro forma net profit after tax dropped by 51.01% to AUD 14.50 million in FY23. However, it met the upper end of its revisedFY23 guidance of AUD 13.5 million to AUD 15 million.

The company finished the year with an inventory level of approximately AUD 98 million, including AUD 7.3 million of inventory added to the New Zealand distribution centre and new stores opened in FY23. 

Top 10 shareholders of BBN

The top 10 shareholders of BBN together have ~41.92% stake in the company, while the top four shareholders have 34.56% stake. The maximum stake is held by AustralianSuper and Bennelong Australian Equity Partners Pty. Ltd. with a shareholding of ~13.13% and ~9.11%, respectively.

Recent business update

Today (1 August 2023), BBN shared that KKR Entities has increased their shareholding in the group to 7.64%, which was earlier 6.60% as of 9 June 2023.

Through another ASX filing dated 28 July 2023, the company announced that superannuation and Investments HoldCo Pty Ltd and its related bodies have increased their stake in BBN to 7.64%, compared to 6.60% as on 6 June 2023.

Outlook

BBN said that it is taking initiatives to reduce operating costs by AUD 6 million to 8 million in FY24.

The company plans to open five new stores in FY24--two in Australia and three in New Zealand. The new stores are likely to aid its revenue growth in the current financial year

BBN share performance

BBN shares closed 21.32% higher at AUD 2.02 apiece on 1 August 2023, with a market capitalisation of AUD 224.61 million. Including today’s gain, BBN’s share price surged by 46.91% in the past one month. However, it dropped by almost 57.83% in the last twelve months.

The 52-week high of BBN is AUD 5.030 , recorded on 11 August 2022, which is 149% higher than today’s closing price. The 52-week low of BBN is AUD 1.135 apiece, recorded on 27 June 2023.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 1 August 2023. The reference data in this report has been partly sourced from REFINITIV.