Troubled department store enjoys resurge, but no word on how Dick Smith is powering electronics
As its Chairman and two board directors stepped down this week, DJ’s had some good news – rising sales.
Sales lifted 4.7% to $618.1 million for the second quarter 2014 (Q214) 27 October – 25 January.
Online sales soared 150%, reflects the popularity of the new web site including “click & collect” and the online gift registry capabilities. Internet accounted for 2% of total revenue.
Like-for Like (LFL) sales rose 2.1% on 2Q13.
Excluding Electronics, which Dick Smith took over from DJ’s as part of a Retail Brand Management Agreement (RBMA) on 1 October, comparable sales were up 3.6%.
DJ’s made no mention of electronics sales in its statement today, but a spokesperson said “it is irrelevant from our perspective as we are guaranteed a minimum EBIT contribution by Dick Smith for this business regardless of sales.”
Best selling categories were Womenswear, Menswear, Beauty, Accessories, Childrenswear and Homewares. Foot traffic and basket size both up in the quarter and half year period.
David Jones CEO, Paul Zahra said, “We were pleased to see growth in both foot traffic and basket size this quarter which enabled us to return to positive LFL Sales growth”.
Whilst the sales growth was “pleasing we did experience aggressive discounting in the market pre-Christmas, in particular in Womenswear.
“We expect this aggressive discounting to continue in 2H14”, and remained cautiously optimistic” about the future.
The Company fully exited of low productivity categories such as Outdoor Furniture, Music and DVDs in the quarter.
DJ’s sales for the first half of the 2014 financial year (1H14) was $1,04 bn up 3.6% on a year ago. LFL sales rose 1.1%.
The Company cycled the launch of its new webstore for the first time in 2Q14 and said its online store operated robustly throughout the Christmas and Clearance trading periods.
Best performing states this quarter were New South Wales, ACT and Victoria.
“We continue to make good progress in the roll-out of our Plan which will enable us to leverage improvements in consumer sentiment and trading conditions,” Mr Zahra said.