Xmas trade boosts profit for Hallenstein Glasson

AUCKLAND: Hallenstein Glasson Holdings said firsthalf profit rose about 34% after the retailer enjoyed a stronger Christmas trading season.

Group sales rose 9.4% to $122.9 million in the six months to February 1, with an 11% gain over the critical December period. The clothing retailer said net profit for the six months ended February 1 was between $9 million and $9.2 million, up from $6.8 million a year earlier. Gross margin in the first half widened about 1.4 percentage points, reflecting a more favourable exchange rate and better cost prices achieved through negotiation, the Aucklandbased retailer said in a statement to the NZX.

Hallenstein said its balance sheet was strong and stock levels were well controlled. Its detailed firsthalf results and dividend will be released on March 30.

The retailer had a tough 2016 with annual profit down 21% to $13.7 million, after a decline in the Kiwi made imports more expensive, squeezing its margins. Its rudderless women’s clothing chain, Glassons, struggled amidst rising competition, especially in Australia, and a warm autumn and mild winter led to a drop in sales. At its annual meeting in December, chairman Warren Bell told shareholders the appointment of Di Humphries to head Glassons had helped turn it around, and that unfavourable forward foreign exchange cover had largely been consumed so margins should improve.

In late 2016, the company replaced longserving chief executive Graeme Popplewell with Mark Goddard, who has 27 years of international retail experience, most recently as president and managing director of Toys ‘R’ Us Japan. He has also held senior roles at Myer Australia, Spotlight Group Australia, and Country Road Australia.

The shares rose 3.6% to $3.42, having plunged as low as $2.59 in 2016 after that year’s firsthalf profit dropped 21%. — BusinessDesk