BREAKING NEWS: Harvey Norman Reports Record Profits
This is the second year that Harvey Norman has outperformed their competitors with the mass retailer hurting retailers such as The Good Guys.
Group earnings before interest, tax, depreciation and amortisation rose 17.7 per cent to $256.2 million. A big contributor was a cut back by Harvey Norman on expensive tactical support for franchisees.
They also cut back on advertising and marketing.
The latest result followed a 36 per cent profit rebound in profit in the December half 2014 and a 23.5 per cent rise in earnings in the September quarter.
Analysts had forecast a net profit of $136 million on sales of $1.39 billion.
Harvey Norman declared an interim dividend of 9 cents, up from with 6 cents previously.
Also helping the big retailer was growth in the property market and low interest rates
“In Australia, our stores are benefiting from improved consumer confidence on the back of strong equity market and strong growth in the housing market,” chairman Gerry Harvey said.
“Against the backdrop of a strong residential property market, growth this half was weighted towards homemaker categories.”
Harvey Norman’s global sales lifted 3.2 per cent year on year to $3.09 billion, while same-store sales increased 3.4 per cent.
“The housing market in Australia is likely to remain strong, supported by record low interest rates and major infrastructure investment in NSW,” Mr Harvey said.
“We expect consumer sentiment to remain stable and positive trends in our business to continue.”
Harvey Norman will pay a full franked interim dividend of 9c, up 50 per cent on the prior interim dividend of 6c.
The distribution payment beat expectations. Analysts at Citi had forecast an interim dividend of 8c per share.