dusk reported FY25 sales of $137 million, up 8.7%. Like-for-like (LFL) sales growth of 7.1% meant a 2H25 LFL sales growth of 3.6%. The trading update for the first eight weeks saw total sales down 1.5%, cycling 16% growth in same period last year. We reference the two-year stack in our forecast for LFL sales growth of 4.2% for FY26e. With limited store openings and growth in LFL sales we forecast FY26e revenue forecasts of $144 million, up 4.9%.

We initiate coverage on dusk, an Australian specialty retailer of Home Fragrance Products, offering a range of dusk branded products at competitive prices from its physical stores and online store. We see dusk pushing plans to improve sales productivity through new product development, category expansion, increasing the release rate of new product and the opening of more metro stores. 

The Australian retail sector imports a significant portion of products from offshore, particularly in non-food categories. In most cases, these goods are purchased in a foreign currency, which means currency volatility can impact the cost of goods and retail profits. In Issue 9 of Price Watch, we analyse the impact that changes in the Australian dollar against the US dollar (AUD/USD) can have on retail prices and profitability. A fall in the AUD/USD typically impacts retail prices with a six-month lag.