Retail in Asia

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David Jones profit surges

David Jones may have concerns about the fragile state of Australia’s economic recovery, but the country’s oldest department store showed on 17 March it was well placed to thrive from the eventual upswing by unveiling its biggest half-year profit in 15 years.

Adding lustre to David Jones’ results were profit margins hitting 40 percent during the half despite heavy discount and promotional activity across the retail sector, a record high interim dividend, tight inventory control and small debt levels.

CEO Mark McInnes also reaffirmed David Jones’ guidance of 5 to 10 percent profit growth for 2009-10 on 17 March but added that he remained cautious about the outlook for the retail sector given the absence of the federal government’s stimulus package.