Harvey Norman full-year profit slides, shares tumble
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The news: White goods retailer Harvey Norman has posted a sharp drop in full-year profit amid a slowdown in consumer spending, but kept the dividend steady.
The numbers: The retail giant said its profit after tax for the year to 30 June, 2024, was down 34.7% to $352.5 million. Aggregate sales revenue declined 3.6% to $8.86 billion, while earnings were down 24.8% to $652.7 million.
The company will pay a final dividend of 12 cents a share, unchanged from a year ago, although total dividend was down 3 cents to 22 cents a share.
Harvey Norman shares were down 4.3% to $4.68 in early trading on the ASX.
The context: The company said its weaker performance came amid ongoing challenges in discretionary retail. The consumer electronics, homewares and furniture retailer, which operates in Australia and seven other countries, said it has a strong balance sheet to cope with the volatile economy and weaker consumer spending, bolstered by its large property holdings.
“Our net debt to equity ratio remains low and conservative at 14.49%, ensuring our capacity to access additional liquidity as needed,” Harvey Norman chair Gerry Harvey said.
Jarden analysts said the retailer's earnings were in line with market consensus and looked like a "nice clean result". They noted second half trends were improving, it had good cash flow and there were no surprises.
What they said: “We had seen some risk into this result, so a good outcome, albeit we would argue share price was not factoring this in post recent performance," Jarden said in a note.
"We see consensus numbers on balance moving slightly lower with AU unchanged and NZ down but overall a good result."
The source: ASX announcement
