KEY POINTS:
The growth of women's clothing chain Glassons is a priority for new Hallenstein Glasson chief executive Shayne Quanchi.
She made her first public appearance in Auckland yesterday as the retailer reported a 6.6 per cent fall in half-year net profit Referring to Glassons, Quanchi said: "We're a little
bit behind the fashion. We're not on trend. We've been a little bit boring, so we really need to be on trend and up with the rest of the market."
The Melbourne-based chief executive will need to draw on her 20 years' retail experience as the clothing retailer - like others in the business - tries to rides out the economic storm.
These are trying times for retailers as consumer confidence dips in an environment of high interest rates, historically dear fuel prices and cost of living increases - a point acknowledged by Hallenstein board chairman Warren Bell.
"Retail conditions will continue to be challenging for the immediate future as high interest rates, increased fuel costs and cost of living increases restrict consumer spending."
But Perth-born Quanchi - just three weeks into the job - sees an upside in its target audience, Generation Y.
"It will impact to a certain degree - however I'm not sure that they are as affected by the climactic conditions that maybe Generation X would feel."
Half-year net profit after tax fell 6.6 per cent from $9.9 million to $9.2 million, in line with the company's January market guidance.
The results reflect an overall decline in sales of 2 per cent, with group sales for the six months ending February 1 falling from $100.7 million to $98.5 million.
Quanchi's Australian retailing experience - which includes a senior role at Myer and a management role at Just Jeans - and the decision to base the CEO in Melbourne was a clear sign of where the company saw growth opportunities.
She said the Glassons brand was a virtual unknown in Australia, and there were plans to increase its visibility across the ditch. This included having a number of new stores.
Online is also another avenue for growth, with Hallenstein's web shop launched before Christmas last year and a similar online store for Glassons planned for the middle of this year.
Forsyth Barr analyst Guy Hallwright said the results were in line with expectations but a slight surprise was the company's ability to retain gross margin growth over the past three years.
But its earnings have not matched up as it contended with rising costs such as wages.
Hallwright said like other retailers, it was likely to struggle in the near future, but crucially, appeared to have good stock level management.
A fully-imputed interim dividend of 17 cents per share was declared.
HALLENSTEIN GLASSON
Six months to February 1
Revenue
2008 - $98.5m
2007 - $100.7m
Pre-tax profit
2008 - $13.8m
2007 - $14.8m
Net profit
2008 - $9.2m
2007 - $9.9m
Interim dividend
2008 - 17cps
2007 - 17cps
*Group's first report under the new NZ IFRS standard
