Net profits dive 11.18% at Hallenstein Glasson

Group sales for the period were $220.117 million, an increase of 2.10% over the corresponding period last year ($215.581 million).

Total Group Comprehensive Income for the period was $20.055 million, ($22.259 million). Included in Comprehensive Income is a gain of $1.17 9 million on revaluation of the Group’s property portfolio.

Whilst performance in the first half of the year was satisfactory, results for the winter season have been disappointing.

Both Hallensteins and Storm brands performed to expectations, but Glassons in both New Zealand and Australia have felt the full brunt of a record mild winter and aggressive discounting in the womenswear marketplace during the past 6 months.

Notwithstanding a decline in profit, the balance sheet remains strong. Stock levels are comparable with the previous year and cash reserves stand at $19.312 million. The group remains debt free.

SEGMENT RESULTS

Hallenstein Brothers

Sales for the year increased 5.33% and net profit after tax improved 17.71%. Hallensteins continued to redefine its position in the market and has made excellent progress in a challenging market.

During the period 3 non strategic stores were closed:

- Newmarket in July 2013

- Pakuranga in March 2013

- Masterton in July 2013

Storm

Sales for the year increased 24.06% (same store 19%) and Net Profit after Tax improved 17.23%. Since balance date Storm has opened its first store in Australia in Chapel Street Melbourne.

Glassons New Zealand

Sales for the year were -3.14% on the prior year, with the winter season proving to be a difficult challenge. Reduced margin resulted in a decline in profit of -21.77% for the full year.

Glassons Australia

Sales for the year (in Australian Dollars) increased 6.45%, with same store sales -5.53%. Reduced margin saw profit decline to a loss after tax in NZD of -$1.161 million. Included in that loss is a pre tax amount of NZD 500,000 incurred for store relocation and restructuring.

During the year we opened a further three stores:

- Chermside (Brisbane) in September 2012

- Moorabbin (Melbourne) in March 2013

- Homebush (Sydney) in July 2013

We also closed in Miranda (Sydney) in July 2013 due to Mall refurbishment. Since balance date we have closed a non contributing store at Geelong.

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Hallenstein Glasson