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Harvey Norman profit tumbles 35 per cent from pandemic high

(Source: Bigstock.)

Harvey Norman has been hit by falling sales and depreciating exchange rates, with global sales falling 8.8 per cent during the period between July and November, and unaudited gross profit falling 35.5 per cent between July and October, compared to the same periods of last year.

According to the department store business, exchange rates across Europe, Singapore and Malaysia hurt the business’ aggregated sales, and were only partially offset by growth in the New Zealand dollar and the UK pound.

Preliminary profit before tax hit $217.4 million for the period, compared to $337.1 million for the same period of FY21, and $127.8 million in FY20 – a 70 per cent increase.

Sales were also up 16.9 per cent compared to FY20, showcasing that, despite Covid, FY21 was a particularly strong year for the chain.

In total, the business’ annual profit rose 75 per cent during FY21: hitting $841.4 million off the back of huge earnings growth of 54 per cent to $1.45 billion.

Moving into FY22, however, the retail industry was hit with lockdowns through most Australian states and territories, and Harvey Norman warned in August that early sales had already been “impacted”.

The group’s comparable performance in Australia fell 11.1 per cent compared to FY21, and 8.1 per cent in New Zealand, as rolling lockdowns across most states and territories of Australia, and parts of New Zealand, impacted sales.

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