Christmas and clearance sales boost DJs profit in Q208

By Matthew Henry

SYDNEY: Department store retailer David Jones has boosted its first-half profit after tax (PAT) guidance citing strong performance over Christmas and the sales period for a jump in total sales to $664 million in 2Q08.

DJs had expected profit after tax (PAT) growth to be within the range of eight to 13 per cent over 1H07.

However, the retailer today upped its profit guidance to the Australian Securities Exchange (ASX) to a range of 23 to 25 per cent, with strong sales over the 2007 holiday period expected to amount to PAT of $87.5 to $89 million.

“We are delighted with our strong sales performance in 2Q08, in particular throughout the critical Christmas and clearance trading periods,” said David Jones CEO Mark McInnes in a statement to the ASX.

“Our increased PAT guidance reflects our strong sales performance throughout this period, particularly in the apparel and gift-giving categories.”

McInnes also said trading in early January and the first two weeks of February has been strong, notwithstanding the fluctuations in the equity market.

Sales for the second quarter of the 2008 financial year were up 9.3 per cent over the same period in 2007.

Total sales for the first half of FY2008 reached almost $1.14 billion, or a 9.5 per cent increase.

McInnes claims stores in all states performed well.

“Western Australia demonstrated exceptional growth throughout 2Q08, followed closely by Victoria, Queensland and NSW, with South Australia and the ACT also delivering strong trading performances,” he said.

“Our new QueensPlaza Brisbane CBD store was successfully launched on 9 February 2008 and customer response has been tremendous. The performance of both of our recently opened Burwood (NSW) and Chermside (QLD) stores have exceeded our expectations and on 30 January 2008 we announced that we are building a new, larger store in Claremont (WA), one of Australia’s most attractive demographic regions.”

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