By Claire Reilly, Current.com.au
Harvey Norman Holdings Limited released its annual results today, reporting a net profit after tax of $252.26 million for the year ended 30 June 2011 – up 9 per cent on the 2010 financial year.
In a statement released to the Australian Securities Exchange, Harvey Norman chairman Gerry Harvey said the company is “well placed to take advantage of emerging opportunities”.
“The franchising operations segment continued to underpin the overall performance of the group and although the operating margin fell from 5.99 per cent for FY10 to 5.01 per cent for FY11, it produced significant net operating cash flow of $301.8 million for FY11.”
“We have a strong balance sheet underpinned by a $2.04 billion property portfolio and generate strong free net cash flows from our franchising operations segment,” said Harvey.
Total revenue from continuing operations for the year was $2.70 billion, which was up from the 2010 figure of $2.45 billion according to the results statement.
“Harvey Norman has an integrated retail, franchising and property strategy and it is this strategy that continues to deliver results,” the statement read.
“The Harvey Norman brands experienced a strong increase in customer transactions even though revenue was down, mainly due to the strong Australian dollar reducing prices on imported goods. There has been much commentary about the cautious consumer, however our franchisees have never experienced so much customer traffic and transactions.
“Even though this is putting pressure on costs, as each franchisee business has many more customers yet lower revenue, the Australian consumer is being rewarded with lower prices.”