Hallenstein lifts profit 40% as it claws back market share
Hallenstein lifts profit 40% as it claws back market share
By Suze Metherell
March 27 (BusinessDesk)
- Hallenstein Glasson, the fast-fashion clothing chain,
lifted first-half profit 40 percent, beating its guidance,
as it clawed back market share in a competitive retail
environment.
Profit rose to $8.6 million in the six months ended Feb. 1, up from $6.2 million a year earlier, the Auckland-based company said in a statement. That's above the $8.1 million to $8.3 million range it gave in January. Sales rose 4.1 percent to $110.9 million, while costs slipped 2.1 percent to $43.9 million. The retailer lifted its first-half dividend to 14.5 cents per share, from 12 cents per share a year earlier.
Hallenstein has been
one of a number of retailers that struggled through 2014 in
a tough trading environment as they faced intense
competition from online rivals, thrifty Australian consumers
and unfavourable weather conditions. Retailers have been
squeezing margins to offer discounts in a bid to lure back
shoppers to their bricks and mortar stores.
“We are
pleased with the progress we have made in regaining market
share," said chief executive Graeme Popplewell. "The
critical trading period of December and January was
particularly robust, and we have seen that momentum carried
forward into the first few weeks of the second half of the
year. "
The summer boost to sales had flowed through
to the first seven weeks of the new season, with sales up 14
percent on last year, Hallenstein said. It was premature to
forecast for the winter season, as it had only just begun,
but each chain was "in a strong position to capitalise on
results so far and are approaching the season with
confidence."
The company's menswear chain,
Hallensteins lifted its first-half profit 52 percent to $5.8
million, while its sales increased 5.3 percent to $45.3
million. The brand has embarked on a marketing campaign to
grab back its market share, which had lifted its early
winter sales, the retailer said.
The New Zealand
operation of its Glassons womenswear brand reported a 12
percent drop in profit to $2.3 million, as its sales were
little changed at $41.3 million. Meanwhile, Glassons
Australian operations narrowed its first-half loss to
$184,000, from an earlier loss of $1.2 million, as sales
lifted 10 percent to $19.9 million. The chain has also
boosted marketing, including launching concept stores in
Australia, to lift brand awareness. Sales since December had
turned around and continued into the new season, Hallenstein
said.
The company's Storm brand, which targets an
older demographic than Glassons, doubled profit to $431,000
while sales increased 1.5 percent as it narrowed margins
through tighter buying, the retailer said.
Shares of
the company advanced 5.3 percent to $3.40, and have gained
2.9 percent since the start of the year.
(BusinessDesk)