Furniture retailer Nick Scali had a 45 per cent fall in profit for the half year as consumers cut down on discretionary spending.
The company delivered a net profit of $2.5 million for the half year to 31 December, down $4.6 million on the previous year.
The retailer said the decline in profit came as a result of both reduced sales and a very rapid decline in the Australian dollar that impacted margins.
Net profit before tax was $3.6 million from $6.6 million in 2007, down 44.7 per cent.
"This result was achieved in very difficult trading conditions," the company said in a statement.
In January, traditionally the industry’s biggest trading month, orders were down two per cent overall and 6.5 per cent on a comparative store basis, compared with last year.
"The December government stimulus package, which was primarily aimed at those other than our typical demographic, provided only a short-lived boost for orders in early January," it said.
"As market conditions remain unpredictable and the implementation and impact of further government stimulus initiatives uncertain, it remains very difficult at present to forecast trading results for the full 2008/09 year."
The directors continue to assess new store locations and will commit to open stores in strategic locations.
Two new stores opened at the end of December, at Richmond and Frankston, both in Victoria.
Further stores are planned or committed nationally within the next 18 months, including in South Australia, Queensland and Victoria.