KEY POINTS:
News from the retail sector keeps getting worse, as Briscoe and Hallenstein Glasson this morning both reporta big fall in sales.
Retailer Briscoe Group says third quarter sales fell 11.2 per cent from a year earlier to $77.8 million, although some improvement was noted towards the end of
the period.
Hallenstein Glassons has this morning issued a notice to the stock exchange saying New Zealand sales have fallen 8 per cent, accompanied by a warning of "considerably" lower profits for the year.
The Briscoe figures for the 13 weeks to October 26 compared with $87.6m for the third quarter of last year, with the company saying the timing of Labour Day had an impact.
Group managing director Rod Duke today said that competitive trading conditions experienced through the first half of this year continued into the third quarter.
"Our August and September results were poor but we were reasonably satisfied with a more buoyant October performance," he said.
As previously advised, second half net profit would be behind the $11.9m in the corresponding period a year ago, said Duke.
Briscoe woes are not its alone though, with listed clothing retailer Hallensteins Glassons issuing a profit warning to the stock exchange this morning.
First quarter sales - from August 2 to October 31 are down 6.7 per cent on the same period last year.
Things in New Zealand are worse than its Australian operations, says the company with trading down 8 per cent on this side of the Tasman. Sales in Australia are actually up slightly - though just 1 per cent.
"Projected earnings for the first half of the year to February 2009 were 'difficult to predict due to the uncertain nature of the market and the significant impact that December has on earnings'," says the notice.
"However directors advise that given current trends, profit will be considerably below the prior year profit."
The company said it would make another update on trading conditions at its annual shareholders meeting on December 18.
In September, Briscoe, the homeware retailer which also owns Rebel Sport and Living & Giving reported a 70.6 per cent fall in interim net profit to $3.09m.
Today Duke said the second half outcome would, of course, be particularly affected by the strength or otherwise of the retail market during the Christmas period.
The company said a significant difference between the third quarters this year and last year was the timing of Labour Day.
Last year, Labour Day activity was accounted for in third quarter sales, but this year Labour Day fell as the first trading day of the fourth quarter.
Adjusting for that, and on a same store basis, the group's sales for the period were 8.1 per cent below those for the third quarter of last year.
Homeware sales decreased 10.2 per cent to $53.1m in this year's third quarter, while sporting goods sales decreased by 13.3 per cent to $24.7m.
Adjusting for Labour Day and on a same store basis, homeware sales decreased by 8.4 per cent for the quarter, while sporting goods sales were down 7.6 per cent.
A new Briscoes Homeware store in Masterton and a new Living & Giving store in Auckland's CBD increased homeware store numbers to 56. Sporting goods store numbers were unchanged at 32.
The group was on schedule to add a further Living & Giving store at Queensgate, Lower Hutt in December.
The October quarter sales figure took group sales for the year-to-date period, from January 28 to October 26, to $259.8m, a decrease of 6.5 per cent on the first nine months of last year.
Homeware sales were down 4.4 per cent during the period, while sporting goods sales decreased 10.9 per cent.
Briscoe Group shares closed at 80c yesterday, having ranged between $1.50 and 73c in the past year. Hallensteins shares are down 5 cents today, to $2.40.
- NZPA/ HERALD ONLINE