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Profits soar for Harvey Norman in 97-98

Profits soar for Harvey Norman in 97-98

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The good news keeps coming for retailer Harvey Norman Holdings which was able to announce last month an operating profit of $90.17 million to shareholders for the financial year ending June 30, 1998. This represented a healthy 53.8 per cent increase on the $58.63 million recorded for the previous year.

A press release from Harvey Norman stated the net profit after tax and abnormal items expenses of $32.58 million came to $57.58 million - a 60 per cent increase on the $35.98 million net profit recorded for the year ended June 30, 1997.

According to the released information, sales from all stores, including those which are franchised and those owned by the company, totalled $1.480 billion which was up 21.7 per cent from $1.216 billion. Sales grew most significantly in the second half of the quarter and have been continuing the climb in the first few months of the 1997Ð98 financial year.

General manager, computers and communications, Tony Gattari said that while exact profitability was not available on the $425 million turned over by his group, it was on par with other divisions.

"Computers is our hardest division to run," said Gattari. "It is an area that is fraught with danger and we lost a lot of money in the early years but we were able to sustain that investment and now, after a number of years, we have been able to turn that around into a profit.

"It [computers] is certainly not the most profitable division, but we are very happy with the money it is now making and it would now be able to turn over profits as a stand-alone," he said. "Not only is it representing an enormous amount of growth in terms of revenue, but it is also now contributing to the bottom line."

In July and August 1998, sales have increased 41.2 per cent on the same period for last year and with new franchises and new stores opening, future sales growth is also expected. Dick Smith also announced that its Group Property Portfolio had increased from $194.49 million at June 30, 1997 to $260.52 million at June 30, 1998.

As a result of the favourable results, Harvey Norman will be able to offer shareholders a final fully-franked dividend of between 3.5 to 5.0 cents per share with the total dividend for the year being 10.0 cents compared with 6.25 cents for the previous year.


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