Lockdown turns boom time for Harvey Norman

Harvey Norman says booming sales across its stores will deliver a 20 per cent leap in pre-tax profits for fiscal 2020.

Harvey Norman says full year profit is expected to be up 20 per cent for the 2020 financial year.

Harvey Norman says booming sales across its stores will deliver a 20 per cent leap in pre-tax profits for fiscal 2020.

The electronics and homegoods retailer issued the profit upgrade to the ASX on Tuesday morning. It follows a recent sales update which showed that Harvey Norman stores were witnessing a rush in key product categories such as freezers and kitchen appliances, as many households bunkered down for home isolation caused by the coronavirus pandemic.

Harvey Norman said unaudited preliminary accounts for the period 1 July 2019 to 31 May 2020 indicated profit before tax and non-controlling interests, but excluding leases net impact and net property revaluation adjustments, had increased 20 per cent compared to the prior corresponding period.

The company will be reporting its full year results on August 28.

Earlier this month, Harvey Norman reported bumper sales for its stores since March and also partially reinstated its interim dividend. That dividend had initially been cancelled due to growing concerns about the health crisis and a desire by Harvey Norman to maintain its cash holdings in expectations of an economic downturn.

Two weeks ago Harvey Norman reported massive sales growth of 17.5 per cent for its Australian stores in the second half. It also announced a special dividend of 6c per share to be paid at the end of June. News of the dividend followed its April decision to cancel a ­planned interim payout of 12c per share.

Harvey Norman’s flagship Australian stores recorded first-half sales growth of 0.1 per cent, rocketing to 17.5 per cent for the second half to date. For the full financial year to date sales for its Australian franchise stores were up 7.4 per cent.

Harvey Norman said government decrees saw many stores across its network in New Zealand, Malaysia, Singapore, Ireland, Northern Ireland and Europe close between March and April. This had an impact on revenue, with sales in the second half to date down 38.2 per cent in Northern Ireland, 21.7 per cent in Singapore, 7.3 per cent in New Zealand, 5.5 per cent in Slovenia and Croatia, up 1.3 per cent in Malaysia and up 25.4 per cent in Ireland.