Hallenstein Glasson Holdings Limited Analysis

Overview

The present company was the vehicle for the merger of Hallensteins and Glassons retail chains in 1985. The company's stores cater for the medium priced-quality end of the market, and the group's property assets are principally occupied by Hallensteins and Glassons stores.

In June 2003, the company decided to withdraw its Hallensteins menswear chain from Australia and focus expansion on the Glassons womenswear chain.

In March 2004 it agreed to sell its HBKGirl outlets. In September 2007 the group's total stores stood at 111, including 25 in Australia.

In May 2008, HLG moved its Glassons buying team to Melbourne for the purposes of moving its `core function' to the `growth opportunities' that are present within the Australian market.

Performance

The following information was extracted from Hallenstein Glasson Holdings Limited's half year results, released on 28 March 2025:

UNAUDITED RESULTS FOR 6 MONTHS ENDED 1 FEBRUARY 2025

The Company advises that unaudited total Group sales for the six months to 1 February 2025 were $240.0 million, compared to $223.0 million in the prior corresponding period. Group unaudited net profit after tax (NPAT) was $21.2 million, an increase of 0.3% over the corresponding period last year ($21.1 million). The result is in line with the guidance announced to the NZX on 28 February 2025.

Gross margin on sales was 58.5% compared with 58.9% in the prior corresponding period. The reduction in the margin was due to the challenging New Zealand retail environment over the peak trade period. The strengthening USD continued to impact on our inventory purchasing costs.

During the six months to 1 February 2025 there was a continued focus on operating cost efficiency across the Group given the difficult trading environment. This was balanced with continued investment in our operational capabilities to support the growth of our Australian brands, which continue to deliver strong performance. Inventory levels were tightly controlled and ended the period lower than the prior year end.

The balance sheet remains in a strong position with improved working capital compared to the prior corresponding period and significant cash reserves of $49.9 million.