The great Australian property boom continues to benefit Nick Scali Limited (ASX: NCK) after the furniture and home wares business upgraded its full year profit guidance this afternoon.
For the year ending June 30 2017 the group now expects its net profit to be in the range of $36 million to $40 million, which is around 40% higher than the prior corresponding year.
The group also updated the market that same-store sales have continued to grow at a double-digit rate for the four months to April 2017, as rising Australian property prices and household wealth translate into more spending at the Nick Scali and Sofas2go branded stores.
Since the start of the housing boom and cash rate cutting cycle in 2012 the group's share price is up nearly 400% as it has also managed to deliver steadily rising margins and falling operating expenses.
Nick Scali's primary listed rival in Harvey Norman Holdings Limited (ASX: HVN) has also managed to double its market value since 2012 on the back of increased demand for home furnishings commonly paid for on credit at Harvey Norman stores.
Nick Scali shares closed at $7.08 today and could be in for a strong day tomorrow, although long-term focused investors should consider whether we're now at, near, or past, the top of the housing cycle.
