• 1H FY25 pro forma NPAT up 37% to $4.8m
• Gross profit margin of 39.8%, up 260 bps vs pcp
• Comparable store sales growth of 2.2%, Q2 FY25 at 4.5%

Baby Bunting Group Ltd has reported strong preliminary and unaudited 1H FY25 results. The company's 1H FY25 pro forma NPAT was $4.8m, up 37% compared to 1H FY24. The company's gross profit margin for 1H FY25 was 39.8%, up 260 basis points compared to the prior corresponding period. Comparable store sales growth for 1H FY25 was 2.2%, with Q2 FY25 comparable store sales growth at 4.5%. The company's net debt position at the end of 1H FY25 was $9.1m. Baby Bunting's CEO, Mark Teperson, said the results demonstrate the company's successful progress in executing its strategy of growing market share, EBITDA and return on capital. The strong November and December trading periods, well-executed campaigns, and focus on renegotiating supplier terms, simplifying price architecture, and exclusive brands and private label work have all contributed to the significant gross margin expansion. The company's store refurbishment program is also on track, and the momentum has continued into the first weeks of 2H FY25.

FY25 pro forma NPAT is expected to be in the range of $9.5m to $12.5m, based on expectations of: comparable store sales growth in the range of 0% to 3%, gross margin of 40%, cost of doing business increases including new and annualising store costs, wage inflation of 3.75% and additional roles and marketing to support strategy execution, and capital expenditure of $10m - $13m, fully funded through operating cash flow.

FY25 earnings guidance is maintained. The outlook assumes no significant changes in economic and retail trading conditions, and no significant increases in sea freight expenses.