David Jones has reported that sales declined 1.3 per cent to $462.1 million for the fourth quarter ending July 28, and confirmed guidance for a 35 to 40 per cent decline in earnings for the year.
David Jones chief executive Paul Zahra said that while trading conditions continued to be challenging the company saw an improvement in its sales tracking for the quarter with the 1.3 per cent decline in total, and like-for-like sales, comparing to a 4.3 per cent decline in like-for-like sales for the full year.
‘‘We are making good progress in implementing our Future Strategic Direction Plan and look forward to updating the market on our progress at the time of our full year results in September,’’ Mr Zahra said.
David Jones stunned investors in March when it unveiled a full-year forecast of a 40 per cent slump in profit, implying a fall of up to 75 per cent in second-half earnings, as its traditional well-heeled customers continue to pay down household debt and increasingly hunt for bargains online.
Just as bad was the news that earnings from its lucrative credit card business will stagnate before halving in 2014 when the venture moves to a profit-sharing arrangement.
The company had flagged continuing sales declines in the second half just ended but the company predicted modest earnings growth starting this financial year as it enacts strategies to get gross profit margins back about 40 per cent.
Yesterday, the company said its best performing categories in the fourth quarter were womenswear, beauty, menswear, shoes and accessories while its home product range and electricals continued to be challenging.
The best performing states for the department store were Victoria, the ACT and Western Australia ‘‘all of which delivered positive growth’’.
The company said it has also cleared the excess inventory issue it faced last financial year and ‘‘is well positioned with new inventory for the start of the 2013 financial year.