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Harvey Norman FY Profit Soars 30%, Boosted By IoT Growth

Harvey Norman has posted full-year net profit after tax of $348.61 million, up 30 per cent on the previous year, with the retailer stating franchisees have capitilised on IoT growth.

Profit before tax excluding impairment losses was $526.32 million, up 39.1 per cent on the previous year.

Franchisee headline sales grew 7.6 per cent to $5.33 billion, compared to growth of 3.7 per cent in 2015, with chairman Gerry Harvey noting the impact of the IoT trend.

“From connected fitness to home automation to intelligent mattresses, franchisees are selling the devices and technology so customers can connect their home, their work, their health and fitness and their recreation,” Harvey commented.

“The possibilities are enormous and we see it as a sustainable retail trend that franchisees intend to be at the forefront of with the best service and expertise and leading products.”

Harvey stated the growth in franchisee sales demonstrates “the strong position of Harvey Norman in the home and lifestyle market”.

The retailer stated that franchisee sales growth remains strong in home and lifestyle, “underpinned by a resilient residential property market”.

“Housing market conditions have been robust, responding positively to the reduction in interest rates in recent years,” Harvey Norman stated. “Population growth has also been an important driver of new dwelling construction growth and refurbishments of existing homes.

“The number of newly approved dwellings has been above completions for some time, which suggests a continuation of solid housing activity, particularly in New South Wales and Victoria.”

The company-operated retail segment, meanwhile, delivered 78.2 per cent growth in profit before tax, totalling $73.11 million, with the retailer stating the record result was built on strong performances from operations in New Zealand, Singapore, Malaysia and Ireland.

Looking ahead to the 2017 financial year, Harvey Norman stated that in the period July 1 to August 28, headline franchisee sales increased 6.4 per cent and comparable franchisee sales increased 6.6 per cent year-on-year.

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