Foreign currency appreciation pushes Harvey Norman’s first quarter sales up

It was not the post-Federal election spending that helped Harvey Norman lift its first quarter sales results for the 2014 financial year, but rather an appreciation in foreign currencies.

“We have not seen a boost to consumer spending post the Federal election but look forward to a good Christmas trading period,” said Harvey Norman chief financial officer Chris Mentis in a statement to the ASX.

The company reported global sales from its Harvey Norman complexes, commercial divisions and other sales outlets in Australia, New Zealand, Slovenia, Croatia, Ireland and Northern Ireland — excluding Singapore — totalled $1.37 billion for the first quarter, which is up 2.7 per cent from the same period last year.

On a like-for-like basis, global sales for the three months when compared to the same period last year increased by 4.3 per cent.

The company said global sales were positively affected by a 20 per cent appreciation in the Euro, a 11.2 per cent appreciation in the British Pound and an 11.8 per cent appreciation the New Zealand dollar for the three months, compared to the same period last year.

As a result, Harvey Norman’s global sales were mainly driven by the total sales increase experienced by its Ireland operation that saw total sales there increase 14.2 per cent (measured in Australian dollars).

This is in comparison to Australia, which only reported a 1.2 per cent lift in total sales. Two Harvey Norman franchised complexes in Australia were closed during the quarter.
At the same time, Harvey Norman’s Northern Ireland global sales results for the quarter fell -53.7 per cent. According to Harvey Norman, two company-owned stores in the country ceased selling electrical and computer goods and were converted to sell only furniture and bedding.

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