NZ's Warehouse H1 net profit falls 24 percent

WELLINGTON, March 12 (Reuters) - New Zealand's largest listed retailer The Warehouse Group Ltd (WHS.NZ) on Thursday reported a 24 percent fall in first half net profit on weaker sales and one-off costs.

The Warehouse made a net profit after tax of NZ$49 million (NZ$24.7 million) in the six months to Jan. 28, compared with NZ$64.3 million in the same period last year.

It had previously advised that quitting its grocery and liquor businesses would cost it up to NZ$13 million in the half year.

The Warehouse said it expected a full year net profit to be similar to last year's adjusted result of around NZ$81 million.

The company said trading conditions were tough, as the country's economic recession continued and margins were under pressure.

"So long as the prospect of higher unemployment and low consumer confidence remains, the retail environments will continue to be challenging," Chief Executive Ian Morrice said in a statement.

It declared an unchanged interim dividend of 15.5 cents a share.

Shares in the Warehouse closed on Wednesday at NZ$3.52. So far this year the stock has gained 1.4 percent, compared with a 8 percent fall in the benchmark top 50 index. .NZ50

The Warehouse has been eyed as a possible takeover target by New Zealand's two main grocery chains, Australian-owned Woolworths (WOW.AX) and local co-operative Foodstuffs, each of which owns around 10 percent.

The Warehouse's closing of the grocery operations saw competition concerns about takeover bids disappear. However, neither of the grocery chains has lodged new bids.

The Warehouse competes against Briscoes Group Ltd (BGR.NZ), KMart (WES.AX), the privately-owned Farmers department stores, and a host of smaller specialist retailers, such as clothing firm Hallenstein Glasson Ltd. (HLG.NZ). ($1=NZ$1.98)