By Jessica Yun
Retail billionaire Gerry Harvey has warned that a minority government in Canberra after the next election could undermine Australia’s economy and put businesses tackling higher energy costs and labour shortages under more pressure.
The 85-year-old executive chairman of Harvey Norman said it would be “terrible” for the economy if predictions of a minority government materialised.
“We [will] have a political system that’s destined for having fight, after fight, after fight, (and) slowing down the economy at a rate of knots,” Harvey told this masthead. “All they do is slow us down and make more rules and make it harder to work. Our industrial relations policies are just hopeless. Our energy policies are hopeless.”
Harvey Norman executive chairman Gerry Harvey said cooler temperatures in the east coast led to lower sales of air conditioning units, fans, outdoor furniture and barbecues.Credit: Janie Barrett
The retail mogul’s comments followed the release of Harvey Norman’s results for the first half of the 2025 fiscal year that showed the furniture and white goods retailer remained largely unscathed by cost-of-living pressures.
The company notched up a 39.7 per cent uptick in profit after tax to $279.4 million on the back of strong demand for fridges, cookware, lounges and bedding at the more premium end of the scale. The best-performing products were the new generation of AI-based computers, Harvey said.
“We’ve heavily promoted that, and the growth there has been a bit of a standout,” he said. “It’s just the beginning … It might fizzle out a bit, but it might really accelerate.”
Harvey added that the average consumer was in a better financial condition than expected, despite a string of retailers running into trouble and supermarket giants – Coles and Woolworths – highlighting consumers were opting for cheaper grocery items to make ends meet.
“In July, December, I thought the business would be a little bit more difficult than it was. It actually ended up better than I thought,” he said.
“It looks like the rest of the year is going to be better than I thought.”
Total system sales revenue (which includes franchisee sales) rose 4 per cent to more than $4.8 billion. In Australia, comparable franchisee sales rose 5.3 per cent to $3.3 billion, and profit before tax rose 26 per cent to nearly $180.3 million.
The $6.3 billion retailer’s backlog of orders is also swelling, with delays in the construction sector slowing down the delivery of ordered items.
“Our pending files are larger than they’ve been for a very long time,” Harvey said. He declined to put a figure on the backlog, but said it was “well in the hundreds of thousands”.
Harvey Norman’s performance overseas was mixed: Slovenia and Croatia grew the most, at 7.9 per cent, while Ireland sales lifted 5.4 per cent. Meanwhile, in the UK, which has been a painful market for Harvey Norman, sales for the period slid 6.3 per cent. Malaysia also retreated 4.4 per cent.
Harvey said it would take time to build a brand in Britain, and he waved off the poor performance in Malaysia. “It’ll be just for a short period of time. It’s a matter of the big picture over the next five years.”
Harvey Norman’s newly opened store in Birmingham, England, the first opened on the British mainland.Credit: Domenico Pugliese
The company has declared an interim dividend of 12¢, up from 10¢ the year before. Investors sent the retailer’s share price 2.6 per cent higher on Friday, with analysts commending the first-half result for beating expectations.
“Sales momentum is generally improving,” said E&P executive director of consumer and research Phillip Kimber, adding that investor sentiment towards discretionary retailers was becoming more optimistic.
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