Discount variety retailer The Reject Shop has reported sales of $458.3 million for the first half of FY24, a 4.2 per cent increase year on year, with comparable store sales up 2.3 per cent.

The company said the growth was driven by an increase in customer transactions and units per basket, which it attributed to a new and improved merchandise offering. 

Despite “challenging trading conditions”, the retailer generated over 1.2 million more customer transactions versus last year.

“With cost of living pressures remaining elevated, customer demand remained robust for low-priced consumables that represent great value, particularly branded products,” the firm said.

Meanwhile, general merchandise sales were down, with planned lower average selling prices largely offset by strong unit volume growth.

EBIT for the half was $19.4 million, down 16.1 per cent year on year. 

The company ended the half with a national store network of 383, up from 376 at the end of December 2022.

“The Reject Shop is a merchandise-led business so I am delighted to see an increasing number of Australians shopping at The Reject Shop to save money on branded everyday essential items and to discover the excitement of our new general merchandise and seasonal ranges,” said Steven Fisher, chair of The Reject Shop.

“Like many Australian retailers, The Reject Shop is facing some near-term margin pressure from higher shrinkage and rising costs. 

“The company is well placed to navigate these challenges with its strong balance sheet, which comprises over $80 million of cash and no drawn debt,” added Fisher.