COUNTRY ROAD

Sales in comparable stores were down a disappointing 8.6% (in Australian dollar terms) reflecting the very challenging trading conditions in Australia – comparable sales there were down 10.9%. This was offset by an increase in South African (rand denominated) sales of 24% (with comparable store sales up 7.9%) where the Country Road and Trenery brands continue to perform well. The segment is targeting a return on sales of 8% in the medium term. In addition to the 14 Country Road and five Trenery stores opened in 2011, the business plans to open a further three stores in South Africa in 2012 (whilst closing one in Australia), and then opening a further three stores in Australia in each of the subsequent years.

With difficult trading in Australia and strong performance of brands in South Africa, Country Road is focused on a continued drive on cost.
A new Chief executive officer, Howard Goldberg, was appointed in March 2011 in an attempt to drive improvement. He comes with extensive Australian retail experience and has already begun to make a very positive mark on the business.
 

We began as a niche women's shirting business in 1974 and soon became Australia's first lifestyle brand, renowned for simply stylish, high-quality apparel, accessories, and homewares. The 1980s and 1990s saw us significantly expand our Australian store base and wholesale business, whilst also entering the US and Asian markets. Our innovative Country Road superstore concept was developed and, for the first time, Australians could access all four key product areas - womenswear, menswear, accessories, and homewares - in one integrated lifestyle destination. The 1990s were, however, lean years. The US business failed. In Australia, the brand became less competitive and ultimately unprofitable.

With a bold new vision for the brand, Woolworth Holdings Ltd South Africa secured a controlling interest in Country Road in 1998 and we began to re-build the business from the bottom up. We exited the US and Asian markets, reduced our prices, and established a more fashionable offering in step with changing consumer trends. In 2004 we relaunched with a new modern identity. Over the next 3 years our store base began to expand rapidly. We ceased wholesaling and entered Australia's two major department stores on a concession basis. Childrenswear and babywear ranges were introduced, completing our lifestyle offer.

With 60 retail stores, an additional 80 concession outlets, and over 2000 employees in Australia and New Zealand, we've regained control of the brand and once again become a significant market leader in the Australian retail and fashion industry.