Hallenstein Glasson Holdings Limited advises a trading update and profit forecast for the summer season will be issued to the NZX on Friday 3rd February 2017
Chief Executive of Hallenstein Glasson Holdings Ltd set to retire
Trading update and earnings guidance 20 August 2012 Revenue The company advises that group sales for the year ended 1 August 2012 were $215.6 million (last year $205.5 million) an increase of 4.9% over the prior year. CEO Graeme Popplewell commented “Notwithstanding an exceptionally challenging retail environment all brands have shown positive same store growth and grown market share. Gross margin on sales improved and market anomalies as a result of the Christchurch earthquakes are now behind us.” Earnings Guidance Net profit after tax is projected to be in the range $20.4 million to $20.8 million (last year $18.283 million) an increase of approximately 13%. Included in pre tax earnings are insurance proceeds relating to the Christchurch earthquake of $1.9 million (last year $2.97 million.) Underlying earnings from trading are forecast approximately 20% up on the prior year. A full earnings release will be issued to the NZX on 26 September 2012.
The Company advises that DI Humphries, Managing Director for Glassons has advised her resignation effective 31 October 2012. CEO Graeme Popplewell commented “Di has resigned to join another retailer in a non competing sector of the market. Her resignation is unexpected and we have immediately commenced both an internal and global search for a replacement. Over the past two years we have concentrated on strengthening the Glassons management team and we are confident the calibre of that team will ensure the business will continue to move forward. In the interim key executives will report directly to me.\"
The Directors advise that the audited net profit after tax for the 12 months ended 1 August 2010 was $19.581 million (2009: $12.803 million), an increase of 52.9%. The result includes a onetime non cash tax charge of $852,000 resulting from the change to tax for depreciation on buildings. Earnings before tax on normal business activity lifted 59.7% on the previous year to $29.232 million (2009: $18.302). Total Comprehensive Income for the year after fair value adjustments was $22.237 million (2009: $9.748 million). Group sales were $207.139 million (2009: $198.197 million) an increase of 4.5%. Earnings before tax for the second half of the financial year (February to July) lifted 62.5%, driven mainly on gross margin growth. The growth in gross margin can be attributed to three factors: 1. An improved buying regime that has resulted in a diminished need to clear unwanted stock; 2. A better product offering, and; 3. The stronger NZ dollar. Mr Warren Bell, chairman of directors, commented “Whilst the strength on the NZ dollar has undoubtedly been an important factor in achieving improved margin, we cannot overlook the impact of better buying. This is particularly evident in Glassons, where real gains in margin have been achieved as a direct result of delivering to the market a more acceptable product offering. Our stock levels have been particularly well controlled, and in a difficult retail environment our continued ability to closely manage the business has delivered credible results.” All operating segments performed strongly, and Australia has begun to contribute to the group results. Hallensteins: Sales lifted 4.9% (same store sales 3.9%), and profit before tax increased 28% for the year. Newly relocated and refurbished stores in Cuba Street (Wellington) and Palmerston North have experienced positive growth. Glassons New Zealand: Sales lifted 1.7% (same store 2.6%), and profit before tax lifted 52.9% for the year. The prior year sales included low margin sales from clearance outlets that were not repeated this year. Refurbished stores at Riccarton and Palmerston North which launched the new look Glassons brand performed well and the newly relocated flagship store in Newmarket which opened after the end of the financial year has comfortably exceeded budget expectations. Glassons Australia: Total same store sales lifted 5.07% (in Australian dollars). There were no store changes during the period. Profit before tax was $1.530 million compared with a loss in the prior year of -$1.311 million. Strong margin growth was achieved in Australia primarily through presenting the right product offer. The board is encouraged by this result and a store refurbishment program has been planned to consolidate this result and build a credible base for the future. Storm: The Storm chain grew from 4 to 6 stores and continued to make good progress. New stores were opened in Merivale Mall (Christchurch) and Napier. Since balance date a further store has been opened in Willis Street Wellington, taking the total store numbers to 7. Total sales grew 53.7%, and same store sales were +6.7%. Profit before tax lifted to $0.8 million (2009: $0.331 million). Further sites are under active consideration. Dividend The directors have declared a final dividend of 17 cents per share, payable 7th December 2010 with entitlement 30th November 2010. A supplementary dividend of 3.0 cents per share to non resident shareholders will also be paid on that date. The dividend fully reflects board policy to pay dividends commensurate with performance. Future Outlook The retail environment remains challenging, and we do not see any significant improvement in the near term. In Australia the environment is becoming increasingly competitive, with rising interest rates dampening consumer spending. In New Zealand the future outlook is clouded by a GST increase, with an unknown contra effect from decreased personal tax. The momentum achieved over the past year will be extremely difficult to maintain, and the opportunity to further improve sales and margin on the existing business base will be far more challenging. We have made a positive start to the new financial year with group sales for the first 7 weeks 5% ahead of the prior year, but it is far too early in the year to make any prediction of earnings for the first half. The December trading period comprises a significant proportion of the summer season and any projection at this stage would be premature. A further update will be given at the Company’s Annual Meeting in early December 2010. Warren Bell Chairman of Directors 27th September 2010
TRADING UPDATE, PROFIT GUIDANCE AND DIVIDEND DECLARATION The Company advises that sales for the key trading months of December and January to date have been + 10.7% on the prior year. Sales for the first half of the financial year from 2 August 2009 to 24 January 2010 are +6.7% on the prior year. Chairman of Directors Warren Bell commented “sales results in both New Zealand and Australia have been similar. We have experienced consistent demand from our customers to our offer during this key trading period, and we have been able to protect and grow our margin. Strong trading over this period has ensured our stocks are at very good levels, and we are well positioned to tackle the new winter season.” Net profit after tax for the full six months ended 1 February 2010 is projected to be in the range $8.1 million to $8.4 million, a 50% increase on the prior year. A full six month release will be provided to the NZX on March 25th 2010. Dividend The directors have declared an interim dividend of 14 cents per share, (prior year 10 cents) payable on 26th March 2010. Entitlement date is 19th March 2010. The interim dividend has been declared early to allow the company to fully utilise imputation credits at 33 cents prior to 31 March 2010. 7 cents of the dividend will have imputation credits at 33 cents, and the balance at 30 cents. In addition a supplementary dividend of 2.4706 cents per share will be paid to shareholders who are non resident for New Zealand tax purposes.
HALLENSTEIN GLASSON ANNOUNCES APPOINTMENT OF GROUP CEO Chairman of Directors, Warren Bell, has today announced the appointment of Stephen Timms as Group CEO. Stephen Timms has significant experience in the retail industry, having held senior positions in Australia and America, his most recent position as Group Chief Operating Office for Ascendia Retail (Rebel Sport and Amart Allsports) in Australia. Prior to that position Stephen held a number of senior positions with DFS in a career spanning 13 years. Those positions included Managing Director DFS Mid-Pacific, and more recently Managing Director, Australia, New Zealand, and New Caledonia. Mr Bell said “Mr Timms appointment is the result of an extensive executive search. We are very pleased to have secured the services of such an experienced retailer. Stephen has a great depth of knowledge of the retail industry and comes to us with a very successful track record.” Acting CEO Roy Dillon vacates the position on 31 March 2010, and Mr Timms will spend time with Mr Dillon prior to that date to effect a smooth transition.
Sales for the full six months ended 1 February 2009 were down -2.84% on the same period last year. Sales for the key month of December 2008 showed a decline of -4.6% 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. January sales have shown a slight improvement at +1.90% on the prior year. An intensively competitive retail environment has resulted in margin erosion of approximately 3% points on last year while we protect market share and manage stock levels. In addition, reduced interest rates have resulted in lower interest income on cash reserves, and the cumulative impact on increased costs have impacted on profit. As a result, the forecast net profit after tax for the six months ended 1 February 2009 is expected to be in the range of $5.4 to $5.6 million, down approximately 40% on the prior period. A full profit announcement for the six months ended 1 February 2009 will be announced to the NZX on 27th March 2009.
The Annual meeting of Shareholders will be held on 18th December 2008 at Chateau on The Park, cnr Deans Ave and Kilmarnock Street, Christchurch.
Glassons increases focus on NZ business to meet challenging retail environment Challenging times in retailing have prompted Hallenstein Glasson Holdings Limited to delay moving Glassons’ buying function to Melbourne. Acting Chief Executive Roy Dillon says an earlier decision to shift the buying team across the Tasman has been reassessed in the light of the very difficult business and retail environment. Mr Dillon says, “Our commitment to having a buying presence in Melbourne has not changed; however, we have had to reconsider whether the planned timing and extent of the Melbourne move were right for the business given the significant change in the retail environment in the interim. The result is that we have decided to focus on the establishment of an Auckland based buying office as a first priority.” Until now the Glassons’ buying team has been located in Christchurch. Today’s announcement means that from early 2009 Glassons’ buying, marketing and visual merchandising roles will become Auckland based. The Auckland buying office will continue to buy for both New Zealand and Australia but will be overseen by Tali Kalb, General Manager – Merchandise, based in the Melbourne office. She will be responsible for product direction and buying for both countries, as well as providing a very important “interface” with the Australian management team. Mr Dillon says “We believe the Auckland move will provide Glassons with greater exposure to the fashion direction and growth potential of New Zealand’s largest and most diverse market, as well as placing it at the centre of a larger pool of creative talent. The group remains very committed to growth in Australia but wishes to ensure this is underpinned by a sound New Zealand business.” Glassons will continue to maintain a significant presence in Christchurch. Finance, administration, property and group operations will remain in the south, as will the Glassons Distribution Centre. The distribution centre is a vital hub for the Glassons business. It has recently been expanded to manage the direct distribution to both New Zealand and Australian stores on a next day delivery basis.
The Company advises that sales for the first quarter (2 August 2008 to 31 October 2008) show a decline of 6.7% on the same period last year. Trading conditions in New Zealand have been more difficult than Australia, with New Zealand -8%, and Australia +1% on last year. Projected earnings for the first half to 1 February 2009 are difficult to predict due to the uncertain nature of the market and the significant impact that December has on earnings. However, directors advise that given current trends, profit will be considerably below the prior year profit. A further update will be given at the Company’s Shareholder meeting on 18th December 2008.
The Board of Directors is pleased to announce the appointment of Mr. Roy Dillon as acting CEO, effective 1 October 2008. Mr. Dillon is currently Managing Director of the Hallensteins chain, and has been a Director of the Company for the past 8 years. Chairman of Directors Warren Bell said “we are delighted Roy has agreed to accept this appointment. He has immense experience in all facets of the retail business and his depth of knowledge will be extremely valuable steering the company through the current challenging retail environment.”
Hallenstein Glasson Holdings Limited today announced an audited net profit after tax of $15.868 million for the year to 1 August 2008. This exceeded the market guidance of $15 million issued in July, but was down 25.5% on the previous year (2007: $21.307 million). Group sales were $193.748 million, down 3.2% on the previous year (2007: $200.187 million). Chairman Warren Bell says the retail environment became increasingly challenging as the 2008 calendar year progressed. “The cumulative impact of increased fuel, food, mortgage and rent costs on our customers, coupled with a global melt down of financial markets, has seen consumer confidence fall to a low not experienced for many years.” The company’s strategy for these times is to strive to maintain market share, reduce costs at every level in the business, and to maintain the strength of its balance sheet. “Our current stock levels are acceptable, a demonstration of the tight focus the company has always maintained in this regard. Particular focus is now being placed on delivering economies out of our supply chain, and we have highlighted areas for potential improvements to be realised over coming months.” Mr Bell highlighted the intense cost pressures affecting retail businesses, particularly from rental increases, but indicated Hallenstein Glassons was well placed to take advantage of these. “The impact of the annual rent increases that are being demanded by the major retail landlords cannot be underestimated. In some situations rents are ratcheting to unsustainable levels. We anticipate there will be fallout in some shopping centres where tenants will find it impossible to continue. This may well open up new previously difficult to secure sites, and we have the financial strength to take advantage of these opportunities.” In Australia, the company’s medium term strategy to develop the Glassons business remains intact, although the commencement of any aggressive store rollout programme has been put on hold until market conditions improve. In the meantime, Glassons is continuing with its plans to establish a Melbourne based buying team, and build an infrastructure with knowledge and experience of that marketplace. The fledgling Storm women’s fashion chain is continuing to fulfil its potential with a further site in Milford, Auckland, opening next month. Further site expansion opportunities may present themselves as commercial rent rises begin to impact. Trading for the first two months of the current financial year has been mixed, with sales in Australia showing an increase of 5% while New Zealand sales have declined by 11%. Overall group sales for the first two months of the new financial year are down 9% on last year. Mr Bell says, “The Australian economy appears more resilient than New Zealand, although the prospect of tax cuts, further interest rate cuts, and potential election promises may see the New Zealand retail environment improve in the latter part of this year. It is too early to predict profitability for the current half, although the board considers it unlikely the $9.237 tax paid profit achieved last year will be met.” The Directors have declared a final dividend of 10 cents per share, making a total dividend of 27 cents per share for the year (35 cents per share last year.) The reduced dividend payment is consistent with the previously stated policy of reviewing dividend on the basis of current performance and anticipated future cash flows. The dividend will be paid on 12th December 2008.
Hallenstein Glasson Holdings Limited reports that sales for the winter season have continued to be under pressure from a deteriorating retail market in both New Zealand and Australia, with group sales -6% season to date. Profit after tax for the full year to 1 August 2008 is now expected to be approximately $15.0 million. This compares with $21.3 million last year. CEO Shayne Quanchi says the change in the retailing climate is the result of consumer reaction to increased fuel and food costs and higher mortgage interest rates. “The current environment is the most challenging experienced for a number of years. There is fierce competition for consumers’ wallets. As a result, margins are being squeezed and every effort is being made to control stock levels. Fortunately our business model is based on high stock-turn, so we expect to end the season with our stock levels in good shape.” Hallenstein Glasson Holdings’ full year result is scheduled for release on 24 September 2008.
Hallenstein Glasson Holdings’ half year result in line with market guidance The Chairman of Directors of Hallenstein Glasson Holdings Limited, Warren Bell, today announced a half year unaudited net profit of $9.237m after tax, consistent with the January market update which predicted a profit figure of around $9m. The result is down 6.6% on the same period last year and reflects an overall decline in sales of 2%. Group sales were $98.5 million (2007: $100.721 million.) The company’s balance sheet remains strong with cash and bank balances at 1 February 2008 sitting at $26.450m compared with $24.877 last year. Mr Bell commented that these are uncertain times for retail, both New Zealand and Australia. “Retail conditions will continue to be challenging for the immediate future as high interest rates, increased fuel costs and cost of living increases restrict consumer spending.” Hallenstein Glasson Holdings recently announced the appointment of new CEO, Shayne Quanchi, who has now taken up the role and Mr Bell says her Australian retail experience – particularly in fashion apparel – demonstrates the company’s commitment to pursuing major growth opportunities in the Australian market. Ms Quanchi says, “Australia is a major growth opportunity for us and my experience in the Australian marketplace is a distinct advantage. We already have plans to increase the visibility of the Glassons brand in Australia, including having a number of new stores under active consideration.” “In New Zealand we have a major store refurbishment programme underway. Seven stores were refurbished during the period under review, as well as the opening of a new Glassons store at Albany. A further nine stores are being refurbished in the current half.” Hallenstein Glasson Holdings is also embracing online shopping with Hallensteins’ web shop (www.hallensteins.co.nz) launched in time for Christmas 2007 and a similar Glassons online shop to be launched later this year. Ms Quanchi says it’s apparent to her that a key to the success of Hallenstein Glasson Holdings is the business’s ability to offer customers the right product and manage stock levels. Closing stock was $12.781m compared with $14.522m last year. “Our demonstrated ability to manage stock levels stands us in good stead to capitalise on market opportunties.” Hallenstein Glasson Holdings has declared an interim dividend of 17 cents per share (fully imputed) which is unchanged from the last interim. The Directors advise that the dividend rate for the full year will be reviewed subject to trading results and capital expenditure requirements.
Trading update and profit guidanc The Directors advise that group sales and gross margin for the key trading period of December have been equal with last year. While sales pre-Christmas were patchy, post Christmas sales had been strong, making up for lost ground earlier in the month. Group sales for the period 2 August to 20 January 2008 are -2% on the prior year, reflecting the uncertain trading conditions in both New Zealand and Australia Stock levels have been well managed and are currently below last year. Net profit after tax for the full 6 months to 1 February 2008 is projected approximately $9 million, prior year ($9.9 million). A full announcement on sales and profit for the 6 months ended 1 February 2008 will be made mid March 2008.
Sales for the 17 weeks ended 25 November 2007 were -1.6% on the same period last year reflecting a highly competitive marketplace in both New Zealand and Australia. In particular, the New Zealand trading environment has been uncertain, with October being a particularly challenging month. Anecdotal evidence suggests a widespread tightening of demand in New Zealand, which is a clear response to the reserve bank’s efforts control CPI inflation by increasing interest rates. Given the impact December has on the overall result for the period, the directors advise it is extremely difficult to provide guidance on the profit for the half year ended 1 February 2008. However Directors caution that it is unlikely profit will meet the $9.969 million tax paid profit reported last year for the same period. A further update on performance will be advised mid January 2008.