Results for announcement to the market
This report has been prepared in a manner which complies with New Zealand
International Financial Reporting Standards (NZIFRS) and is based on
unaudited financial statements.
Reporting Period 6 months to 1 February 2010
Previous Reporting Period 6 months to 1 February 2009
Amount (000s); Percentage change
Revenue from ordinary activities: $102,322; +6.9%
Profit from ordinary activities after tax attributable to security holders:
$8,548; +55.9%
Net surplus attributable to security holders: $8,548; +55.9%
The directors advise that the unaudited net profit after tax for the 6 months
ended 1 February 2010 was $8.548 million, an increase of 56% on the prior
period profit of $5.481 million.
The result is slightly ahead of the guidance given to the market on 29th
January 2010.
Total group sales were $102.322 million, up 7% on the prior period of $95.713
million.
Key aspects of the interim result were:
- Group turnover up 7%
- Gross margin on sales up 205 basis points to 55.12% (53.06%)
- Losses in Australia reversed to a modest profit for the period
- Stock levels tightly controlled
Chairman of directors, commented "The improved profit is a solid step towards
regaining profit levels achieved before the impact of the 2008/2009
recession. The effect of improved sales, increased margin, and tight control
on costs has all combined to lift profits towards the levels previously
achieved. Our stock levels are where we want them to be, and the balance
sheet remains particularly strong. Strong trading over the Christmas period
and early January cemented what had been a steady improvement during the
period."
Dividend
An interim dividend of 14 cents per share (last year 10 cents) was declared
on the 29th January, payable on the 26th March 2010. The dividend will
continue to reflect earnings and capital expenditure requirements.
Outlook and current trading
After a year of curtailed capital expenditure on store development, a number
of projects are now in progress. During March Glassons launched a new look
and brand update at Palmerston North and at Riccarton Mall (Christchurch).
The new fitout takes the brand to another level and sets a new standard for
women''s fashion in New Zealand. The concept will be rolled out in a larger
store in Newmarket and also a new store at Te Rapa towards the end of the
half. Other key sites will be upgraded later in the year.
Hallensteins will relocate to a larger site in Cuba Mall Wellington, at the
end of March, and has also relocated to a new site in Palmerston North.
A new site in Wellington has been secured for Storm, opening August 2010, and
further sites are under active consideration.
The first 7 weeks group sales for the new half have been down 2% on the prior
year, although margin is ahead of last year.
Sales are against strong discounting last year, and we caution against
reading too much into these figures. It is too early in the season to make
any prediction on the winter season results. The retail environment is
reasonably stable and consumer confidence is at a stronger level than last
year. Other retailers have used the phrase ''cautiously optimistic'' and in the
absence of any major negative economic news we concur with that sentiment.
End CA:00192920 For:HLG Type:HALFYR Time:2010-03-25:09:23:32