Clothing retailer Hallenstein Glasson has posted a 40 percent fall in first half profit as Covid lockdowns on both sides of the Tasman shut shops and dented sales.
Hallenstein Glasson's December sales fell. Photo: RNZ
Key numbers for the six month to 1 February compared to a year ago:
- Net profit $11.9m vs $19.8m
- Revenue $170.6m vs $182m
- Gross margin 57.9% vs 56.5%
- Interim dividend 18 cents vs 23 cents
The company said sales fell more than 6 percent as it lost 5,432 trading days because of lockdowns across New Zealand and Australia, even though online sales made up a third of group sales compared with less than a quarter a year ago.
A rise in its gross margin had been achieved by cutting costs, getting better prices from suppliers, and benefits of favourable exchange rates, which had been partly offset by higher freight costs.
The company said where shops had been closed it was talking to landlords about rent relief.
"During the financial period additional cost controls were implemented, reducing operating costs and inventory levels were well managed to preserve liquidity," the company said in a statement.
Sales for the Glassons women's clothing chain fell 13.6 percent to $53.4m in New Zealand, but rose 5 percent to $72m in Australia.
"The lockdowns in New Zealand significantly impacted the results of the in-store performance. There is continued focus on technology and the effectiveness of being omni channel with an increase in investment to support the digital strategy."
The Hallenstein Brothers menswear stores reported $45.3m in sales, with store closures once again blamed for the downturn.
The second half of the financial year was still challenging with the Omicron outbreak affecting trading, with sales fractionally ahead of last year.
"The business remains hopeful that the worst of the Omicron outbreak will soon be behind us and is looking forward to a stronger finish to the financial year."
The company declared a lower interim dividend, but said its balance sheet was "strong and inventories well controlled."