Why the Accent (ASX:AX1) share price will be on watch this morning

The Accent (ASX: AX1) share price will be on watch today following the company's release of a trading update after yesterday's market close.

| More on:
shoes asx share price represented by white shoes against pink and blue background AX1 share price downgrade

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Accent Group Ltd (ASX: AX1) shares will be on watch this morning as the company provided a trading update after yesterday's market close. At Thursday's closing bell, the Accent share price finished the day 1.26% lower at $2.35. It will be interesting to see which way the shoe retailer's shares move today after investors digest the company's latest results.

How did Accent perform for H1 FY21?

The Accent share price will be in focus this morning following the company's release of a strong performance update for the first half of FY21.

For the period ending 27 December, Accent reported favourable trading conditions particularly in the last two months.

The company revealed that total sales jumped 12.3% and like-for-like (LFL) sales grew 7.4% in November and December. Overall, LFL sales delivered a 2.7% lift over the first half period. When factoring out the closure of Auckland, Victoria, and Adelaide stores, LFL sales growth recorded a 12.3% increase.

In addition, digital sales for the group set a record, up 110% to $108.1 million compared to the prior period. This segment reflected 22.3% of the entire group's sales.

As a result, Accent advised group earnings before interest, tax, depreciation and amortisation (EBITDA) will be between $95 million and $98 million. This reflects robust growth of around 40% to 45% on the prior comparable period.

In the release, Accent went on to mention that it continues to maintain disciplined cost controls to protect its balance sheet. The company also advised that rental reductions and government wage subsidies helped drive the first half's positive results. 

Due to the continuing uncertainty surrounding COVID-19, however, the retailer did not provide guidance for its second-half year result.

Management commentary

Accent Group CEO Mr Daniel Agostinelli touched on the company's effort, saying:

I am delighted with the way our team has executed through the all-important November cyber events and the lead up to Christmas. Our strong focus and capability in digital, combined with operational excellence in merchandise and store execution has delivered a strong, trading led result.

The Company's store network and best in class digital fulfilment capability, allowed us to fulfill significant volumes of online Christmas customer orders placed up until 22 December in time for Christmas Day.

Accent share price snapshot

Since March, the Accent share price has rebounded from its COVID-19 lows of 55.5 cents. It's also worth noting that Accent shares are currently trading just shy of their $2.41 all-time high reached on Wednesday this week.

Based on the current Accent share price, the company commands a market capitalisation of around $1.27 billion.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Market up or down
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors had a rough end to the week...

Read more »

Man in an office celebrates at he crosses a finish line before his colleagues.
Share Gainers

4 ASX 200 shares racing ahead of the benchmark this week

ASX investors sent these four stocks soaring 12% to 18% this week. But why?

Read more »

A young man sits at his desk working on his laptop with a big smile on his face.
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Share Fallers

Why Dateline, DroneShield, Ora Banda, and Pilbara Minerals shares are dropping today

These shares are ending the week in the red. But why?

Read more »

Man pointing an upward line on a bar graph symbolising a rising share price.
Share Gainers

Why BHP, Coronado Global, EBR Systems, and Whitehaven Coal shares are pushing higher today

These shares are ending the week on a positive note. Let's find out why.

Read more »

man thinking about whether to invest in bitcoin
Broker Notes

Why Macquarie expects this ASX 200 dividend stock to keep outperforming

Macquarie has tipped this ASX 200 dividend stock to outperform. Let’s find out why.

Read more »

a young woman looks happily at her phone in one hand with a selection of shopping bags in her other hand.
BNPL shares

Up 87% since April, why the Zip share price can keep flying higher into 2026

A leading fund manager expects more outsized gains from Zip shares ahead.

Read more »

Man in mining hat with fists raised and eyes closed looking happy and excited about the Newcrest share price
Share Market News

Why BHP and these ASX dividend stocks are buys

The mining giant and these shares have been named as buys by brokers.

Read more »