Hallenstein Glasson issues profit warning after poor December

Photo/Glenn Jeffrey

Hallenstein Glasson is signalling a 40 per cent reduction in its interim profit after experiencing a 4.6 per cent drop in sales in the key month of December.

But the retailer said January sales had improved slightly. Hallenstein Glasson shares were down 3c at $2.20 immediately after the statement was released to NZX. The company reports its interim result on March 27.

Hallenstein Glasson said its net profit after tax for the six months ended February 1 was expected to be in the range of $5.4 million to $5.6m, down approximately 40 per cent on the prior period.

Sales for the full six months ended February 1 were down 2.84 per cent on the same period last year.

Sales for the key month of December 2008 declined 4.6 per cent on last year.

"While the key trading days leading up to Christmas and Boxing Day sales were strong, they were not sufficient to make up for the weak sales experienced in early December," the company said.

January sales were up 1.9 per cent on last year.

The company's margins have been squeezed by three percentage points in the difficult trading environment.

And the company is earning less on its cash reserves because interest rates have fallen.

- NZPA