David Jones has reported a 9.1 per cent rise in annual profit and a 3.4 percent lift in revenues despite furore over sexual harassment claims made by a former PR Manager.
Net profit for the 2009/2010 financial year has risen to $170.8 million from $156.5m in 2009.
The 9.1 per cent growth in profit met the upmarket department store chain’s 8 per cent to 10 per cent guidance.
During the past year the company has moved to expand their appliance and consumer electronics offerings which have benefited from the release of a new iPhone and Apple iPad. Unlike Myer, who is dropping the sale of appliances, David Jones has witnessed an increase in demand for small appliances.
During the past months department stores like David Jones and rival Myer have been discounting stock to lure cautious customers into their stores. This has been achieved say executives because of support from vendors.
The company’s 39.7 per cent annual gross profit margin beat last year’s 39.6 per cent and it forecast margins within a tight 39.5 per cent to 40 per cent range this financial year and next.
According to the Australian, new CEO, Paul Zahra, said to achieve the upper end of this guidance the economic recovery “needs to be in full swing”, something he said economic consultancy Access Economics doesn’t expect to occur until the 2012 financial year.
Mr Zahra became CEO just three months ago after the group lost former CEO Mark McInnes when he admitted to behaving in a manner “unbecoming” of a chief executive toward a female employee. The group is the subject of a lawsuit in excess of $30m from the female staffer, but it has since maintained its earnings guidance.
