The Warehouse Group (TWG) says it will shut down or sell its e-commerce site TheMarket.com in a bid to focus on its core business.
The group announced its interim results on Wednesday morning, posting a half-year net loss of $23.7 million from $1.6 billion dollars in sales, down 4.9% compared to FY23 H1.
Earlier this year, TWG sold its outdoor and sports equipment business Torpedo7 to Tahua Partners Limited for $1, which impacted TWG's half-year financial performance by $55.5 million.
Chief Executive Nick Grayston described the result as a "sobering" outcome.
"The sale of Torpedo7 had a severe impact on the group's financial performance this half," Grayston said, "while the disposal of Torpedo7 means we have incurred significant write-downs, it allows us to redirect our focus to our core brands".
Another part of the company's "strategic reset" is the sale or closure of TheMarket.com by the end of the financial year.
"We are re-directing our focus and learnings into growing Group Marketplace on The Warehouse site and app," Grayston said.
"When we launched TheMarket.com in 2019, it represented a strategic diversification of our business, allowing us to expand our supplier partnerships and offer customers a broader product range."
"We have, however, been unable to achieve the organic growth required to sustain the platform properly. It's time to draw a line under TheMarket.com as a separate entity and shift our marketplace focus to The Warehouse."
Grayston acknowledged that tough economic conditions for consumers were impacting the business.
"Many Kiwi families are feeling the pinch and we know every dollar counts. We're seeing customers seek out value on the essentials, which is putting pressure on big-ticket items, impacting our brands across the board."
"We believe the macro-economic climate will remain difficult, and it is challenging to predict how cautious consumer spending will impact sales across all our brands."
Grayston admits sales in February and March have already been disappointing.
FORMER SUPERMARKET BOSS JOINS BOARD
The Group has also announced Tony Carter will join the company's board as an Independent Director from May.
Carter's previous experience includes various directorship positions with some of New Zealand's biggest companies.
Notably, he served as managing director of supermarket operator Foodstuffs for 17 years, where he played a critical role in their strategic development and expansion.
He also chairs the board of MyFoodBag.
He replaces current director Julia Raue.
