Clothing retailer posts first half profit in line with 2001/02

By NZPA

Friday 14th March 2003

Clothing retailer Hallenstein Glasson posted an almost unchanged interim net profit of $5.82 million for the six months ended February.

That was up 0.3 percent on the same period the previous year, and in line with the company's warning a month ago that profit would be in line with or slightly under the 2001/02 first half result.

The company said today that turnover during summer had improved about 20 percent, with profit nearing break-even.

Sales revenue rose 2.5 percent to $90.39 million on the same period last year, although New Zealand sales for its women's chain Glassons were disappointing December.

"While satisfactory results were achieved in the first four months to the end of November, the critical trading month of December was extremely difficult," directors said today

"The trend to shop later during the month was strongly evident, with many consumers choosing to wait until close to Christmas or the January sale period to purchase their summer wardrobe.

"This resulted in pressure on margins during January 2003 to ensure stocks remained at acceptable levels."

The company planned to open further Glassons stores in Australia, "although the directors want to ensure the current performance is securely locked in place before embarking on any large scale store opening programme".

During the period, HBKGirl opened two new stores, in Napier and Auckland, bringing total store numbers for HBKGirl to 51.

Glassons opened a new store in Rotorua during September, taking total store numbers to 31 in New Zealand. Men's clothing chain Hallensteins opened a new large-format store in Auckland during August 2002, and closed a smaller store at Whangaparaoa.

Looking ahead, the stronger New Zealand dollar against the Australian and US dollars was likely to boost margins, although the competitive market would make it difficult for the company to fully increase its margins.

Shareholders will receive a fully imputed interim dividend of 9c per share on April 25, and a supplementary dividend of 1.588cps will be paid to non-resident shareholders.

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