The number’s up for Harvey Norman, retail margins under pressure

By Martin Vedris

SYDNEY: It’s been a rough start to the year for many companies, with retailers such as Harvey Norman reported to be feeling the pressure. Harvey Norman’s half year sales figures today tell the story of the company’s performance in the six months to December 2008.

In a declining economy, Harvey Norman stores actually reported a sales increase of 3.5 per cent to $3.15 billion for the first half of the year, compared to the same period in 2007.

According to a statement from Harvey Norman today that result is specifically for the sales from the “franchised ‘Harvey Norman’ complexes, commercial divisions and other sales outlets in Australia, New Zealand, Slovenia and Ireland (excluding Singapore)”.

The company also reported that like for like sales for the six months ended 31 December 2008 were up 1.4 per cent over the same period in 2007.

The numbers are even better for the second quarter from 1 October 31 December 2008. Sales from the same outlets were up 3.9 per cent to $1.71 billion for the quarter and like for like sales were also up 1.4 per cent for the quarter.

However, in a sign that the company is feeling some of the heat of the moment, like many other companies, the statement to the ASX concluded with the comment, “Given the current macroeconomic conditions, retail margins continue to be under pressure.”

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