Veterinary and pet shop chain Greencross will put more vet clinics inside its retail stores after the popular innovation helped beat sales expectations and lift profit more than 80 per cent.
The company's net profit of $34.6 million for the year to June 30 is up from $22.1 million the previous year. Underlying profit rose 10 per cent to $42.1 million.
Greencross opened 21 new stores and 23 clinics in 2015/16, taking its total to 376 outlets across Australia and New Zealand.
The new outlets included 14 vet clinics and 14 grooming salons.
Greencross now has 17 in-store clinics and 63 salons, with the company saying the "one-stop shop" setup helped boost sales.
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The company also boosted gross margins through the sale of more private label products.
Chief executive Martin Nicholas said the retrofitting of vet clinics into existing stores and the inclusion of in-store clinics in new stores was a key part of the company's expansion strategy.
"In current market conditions, they represent an extremely attractive growth avenue, with superior investment returns to pure acquisitions," Mr Nicholas said.
"So, we're targeting to open at least a further 15 across Australia and New Zealand in 2017."
Mr Nicholas said the in-store clinics were beating sales targets and had reached break-even point ahead of expectations.
The centres were attractive to young, entrepreneurial vets willing to jointly invest with Greencross in fully-equipped, start-up veterinary clinics, he said.
Greencross expects underlying earnings and post-tax profit growth for the current financial year to continue at similar levels to fiscal 2016.
"We have started the year in line with these expectations," the company said.
Greencross has opened seven retail stores and acquired two large vet clinics so far in the new financial year, with six in-store clinics under construction.
The company also said it had had a positive response to its new private-label dog food, which was launched in June and recorded more than $1 million in sales in 10 weeks.
Shares in Greencross were 10 cents, or 1.37 per cent, higher at $7.40 at 1554 AEST.
NEW OUTLETS HELP BOOST GREENCROSS PROFIT
* Full-year net profit up 81.5pct to $34.6m
* Revenue up 13.8pct to $734m
* Final dividend up 0.5 cents to 9.5 cents per share, fully franked. Full year dividend 18.5 cents.
