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Harvey Norman pre-tax profit hits record

Petrina Berry  |  31 Aug 2017Text size  Decrease  Increase  |  

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BRISBANE - [AAP] Harvey Norman (ASX: HVN) says it has hit a record profit before tax of $639.81 million, thanks primarily to higher franchisee fees and a strong increase in its property values.

The furniture and electrical goods retailer's profit before tax for the year to June 30 is up 29.6 per cent on the prior year, while its profit after tax of $448.98 million, is up 28.8 per cent.

Franchisee sales revenue across the company's three brands in Australia--Harvey Norman, Domayne and Joyce Mayne--rose 5.4 per cent to $5.62 billion.

Profit in the Australian franchisee network, Harvey Norman's biggest market, rose 13.6 per cent to $304.53 million, primarily from higher franchise fees.

"Our strong property portfolio was valued at $2.66 billion as of June 30, 2017," the company's report said.

"These investments provide strong returns in rental and outgoings income from franchisees and third-party tenants, deliver long-term capital appreciation, and provide the flexible floor space needed to respond to the evolving dynamic of the retail marketplace."

Revenue from company-owned stores in New Zealand, Singapore, Malaysia, Ireland, Northern Ireland, Slovenia, and Croatia rose 2.1 per cent to $1.83 billion.

The international segment's comparable sales were up 4.5 per cent on the previous year with total sales boosted by an appreciation in the NZ dollar but hit by depreciations in the Euro, Pound, Malaysian Ringgit, and Singaporean dollar.

The company declared a final dividend is 12 cents, fully franked, 5 cents lower than last year.

Shares in Harvey Norman were down 17.5 cents, or 3.97 per cent, to $4.235 by 1123 AEST.

HARVEY NORMAN PRETAX PROFIT HITS RECORD:

* Profit after tax up 28.8 pct to $448.98m

* Profit before tax up 29.6pct to $639.81m

* Final dividend, fully franked, of 12 cents a share, down 5 cents

 

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