Harvey Norman is loaded for action
FURNITURE and electrical goods retailer Harvey Norman is stocked up and ready for the Christmas rush despite many of its peers facing supply constraints.
Chief executive Katie Page said the company had built up its inventories in Australia and abroad to meet post-lockdown demand.
“We are in eight countries, people forget we are not just in Australia,” Ms Page said after Harvey Norman’s annual general meeting on Wednesday. “We are really comfortable and confident with the inventory levels that the franchisees and the company-owned stores are holding going into that peak period.
“Everyone is talking about supply chain, not just in retail but every industry, and we have managed this … we are really comfortable with our eight countries, where they are sitting, company-owned and franchisees, with inventory.”
It comes as retailers in particular are seeing their supply chains strangled as logistics and transportation freezes up. Rip Curl has warned of a shortage of wetsuits, fashion retailers are worried about their apparel supplies and the nation’s largest brickmaker, Brickworks, on Tuesday warned it recently came within weeks of totally running out of imported pigments used to colour stain bricks.
Meanwhile, Ms Page said sales across its stores, from Australia to Croatia, had accelerated since August as consumers enjoyed their new freedoms.
However, the lockdowns that were imposed across New South Wales and Victoria had cast a pall over its sales and profitability between July and November as Harvey Norman suffered a stinging 11 per cent slide in its sales and a more than one-third drop in its underlying earnings.
In a trading update provided to the market before the Harvey Norman AGM the company did reveal that its sales and profits for the five months to the end of November had climbed strongly when compared to the same period in 2019 – before Covid-19 emerged – but the retailer had felt the pain of lockdowns when holding up the latest results to 2020.
The retailer, which has seen its business boom through Covid-19, said that between July 1 and November 21 its Australian store network had been affected by the lockdowns and store closures.
However, Ms Page said she was gaining confidence from the acceleration of sales from August.
At the AGM there was a 24.64 per cent vote against the re-election of Michael Harvey as a director, a 24.9 per cent vote against the reelection of Christopher Brown and a 27.17 per cent vote against the re-election of John Slack-Smith – but all directors were re-elected.
Shares in Harvey Norman ended down 9 cents at $5.10.