Dire times for Clive Peeters, but hope in sight

By Paul Hayes

MELBOURNE, VIC: Clive Peeters is the latest retailer to report negative sales figures in FY2010, with the company this morning revealing multi-million dollar losses for the latest quarter.

In its H2 2010 trading and business update, Clive Peeters reported that its unaudited net operating loss after tax for the three months January to March is expected to be $4.5 million.

This was a massive increase compared to the same time last year, when the company’s net operating loss was $0.6 million.

In addition to the reported numbers, Clive Peeters said it expects further losses for April as sales have steadily deteriorated.

The company has blamed a combination of the receding effects from last year’s government stimulus packages and a string of interest rate rises on the falling numbers in the second half of FY2010.

“The combination of very subdued sales and margin pressures will materially impact the trading outlook of the company over H2 2010,” said managing director, Greg Smith.

News of Clive Peeters’ losses comes after fellow retailers, including Harvey Norman, JB Hi-Fi and Woolworths, recently announced either flat or negative sales figures, which they also largely attributed to the stimulus cycle and interest rates.

Smith said that while there are reasons for optimism in the retail sector’s immediate future, such as the FIFA World Cup and 3D TVs, difficult times still lay ahead.

“We still expect big ticket discretionary retail conditions to remain very challenging for some time, with the possibility of even more interest rate rises still on the horizon.”

Clive Peeters also reported that the company had sold all but one of the 41 properties that were purchased with misappropriated funds between FY2008 and FY 2009, applying the recovered funds to reducing its bank debt.
 

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