David Jones sees first same-store sales drop since 2014
The leading Australian department store retailer's sales increased 1 per cent in Australian dollar terms, but same-store sales fell 0.7 per cent across the year, according to its South African parent firm.
Woolworths Holdings attributed a slump in consumer confidence in Australia and lagging footfall in David Jones outlets for the demise.
"While relevant market share has grown, sales growth slowed in the second half, as falling consumer confidence resulted in lower footfall," the company said in a statement.
However, sister brand Country Road recorded sales growth for the same twelve-month period, with total revenues gaining 5.1 per cent. Same-store sales dropped slightly, down 0.4%. Improvements in ranges across the men's and women's apparel retailer were the reason behind Country Road's increase, said Woolworths.
Looking ahead, Woolworths said that despite the difficult conditions, David Jones will add to post earnings growth of 20 per cent to 30 per cent for the full financial year. This is mostly due to the sale of David Jones Market Street property in Sydney, which was sold in August 2016 for $360 million
In the same year, Woolworths acquired men's retailer Politix. Other stablemate brands include Witchery, Trenery and Mimco. Woolworths Holdings bought David Jones for $2.3 billion in 2014.
It's been a bitter year for department stores in Australia. Besides the trying local retail landscape, rivals Myer and David Jones have been at each other in recent months, poaching labels and signing emerging designers, in a bid to bolster their retail offerings and attract more custom. The timing is crucial, as shoppers are gradually beginning to open their purses.
The Australian Bureau of Statistics' data in early July showed retail sales rose 0.6 percent in May, beating expectations for a meagre 0.2 percent increase. It also follows a solid 1.0 percent jump in April, marking the best two months of sales since end-2013.
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