David Jones profit down 28%

CEO shares positive long-term outlook.

Woolworths Holdings has reported a 1.9% increase in Group sales for the 26 weeks ended 23 December, 2018, with David Jones sales increasing by 1% for the period. The company said sales softened after the Black Friday weekend in late November, in line with the rest of the market.

Comparable store sales for David Jones grew by 0.3% (2.4% for the first 20 weeks and -0.8% in the final six weeks, adjusted for the one-day pre-Christmas). Operating profit declined by 28.8% to $47 million.

Growth from new stores largely offset the sales disruption from the Elizabeth Street store refurbishment. Net retail space grew by 2.7%. Further net space reductions to improve store portfolio productivity are planned.

David Jones CEO, Ian Moir (pictured) said, “Trading conditions are unlikely to improve in the short-term in either South Africa or Australia, where consumer sentiment remains constrained.

“The completion of the transformational projects within David Jones, with the exception of the Elizabeth Street store refurbishment will enable both businesses to recover from recent underperformance and ensure longer-term growth and profitability.”

There have been recent changes to the board of directors with the resignation of director, Sizakele Mzimela, chairman Messrs Simon Susman, lead independent director, Tom Boardman, as well as independent non-executive directors, Gail Kelly and Patrick Allaway.

Hubert Brody has been appointed as deputy chairman and is expected to become chairman of the board from the conclusion of the 2019 annual general meeting. Zarina Bassa is anticipated to become lead independent director at the AGM also.

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