Sydney-based retailer Gowing Bros Ltd has announced plans to spin off its Gowings Retail business and list it as a separate company on the Australian Stock Exchange next month.

The $10 million raised by the float will be used to fund new store openings, repay loans associated with property, plant and equipment, and finance the float.

John Gowing, chairman of Gowings Retail and managing director of Gowing Bros, said the restructure would allow the company to take advantage of significant growth opportunities. "Gowings has a significant opportunity to grow sales and earnings through the addition of new Gowings stores. We now have a blueprint to do this and will concentrate on areas where the demographics match those of the Gowings customer base."

The 133-year-old business is one of Australia's longest-serving retail institutions and is forecasting a profit after tax of $1.98 million in 2002 and $2.49 million in 2003. The company focuses on competitively priced merchandise, with Gowings' own brands accounting for around 26 per cent of sales.