Profit of $27m but no plans to repay Covid wage subsidies
The owner of clothing chains Hallenstein Brothers and Glassons saw sales recover after a big decline during the level 4 coronavirus lockdown but has no plans to repay wage subsidies it received.
Hallenstein Glasson, which claimed $8.4 million in government support in New Zealand and Australia due to Covid-19, posted a net profit after tax of $27.8 million, down 4.3 per cent but in line with the top of its forecast range released last month.
The company’s balance sheet continued to be strong, and inventories were well controlled, said managing director Mary Devine yesterday.
In New Zealand, Glassons received $2.69m in wage subsidies for 451 staff and Hallenstein Brothers received $2.48m for 415 staff, totalling $5.18m.
In Australia, the company also accessed job totalling $4.98m.
There has been a call for big businesses that made a profit this year to pay back the wage subsidy, originally paid to businesses that had a 30 per cent fall in revenue due to Covid. About $14 billion has been paid out to businesses through 756,649 applications, and $442.3m has been paid back.
Devine said the company had no plan to return the wage subsidies, seeker payments which she called instrumental to the company’s ability to keep staff on during the pandemic.
‘‘These are still very uncertain times, things are moving fast.
‘‘It was the right decision by our people and we are comfortable with our position.’’
The company had made a commitment to paying staff 100 per cent of their wages but reduced that to 80 er cent for some of the period, she said.
The fashion retailer reconsidered its decision in May not to pay an interim dividend, paying 15 cents per share earlier this month.
A fully imputed final dividend of 24c per share, on par with the previous year, will take the full year dividend to 39c per share.
Overall sales rose 0.1 per cent for the year ended August 1, predominantly due to the high level of online sales from April onwards, Devine said.