Shares of Harvey Norman Holdings Limited (ASX: HVN) shot 14 cents, or 3.6% higher today to $4 after the company provided an update on sales for the three months ended 30 September.
The specialty retailer reported sales of $1.5 billion for the period globally, up 6.1% on the previous year, although like-for-like sales rose by a stronger 7%. The sales results were positively impacted by an appreciation in the Euro and the UK Pound, and negatively impacted by a devaluation in the New Zealand dollar during the period.
Like-for-like sales were even stronger locally, rising 7.1% compared to the three months to September 2014. Despite the tough retail environment, companies like Harvey Norman and competitors JB Hi-Fi Limited (ASX: JBH) and Nick Scali Limited (ASX: NCK) have benefited from the booming property market with new buyers looking to spruik up their homes with new furniture and electrical goods.
The Coalition government's tax breaks on purchases made by small businesses (e.g. on laptops and other hardware) have also provided a tailwind for Harvey Norman and JB Hi-Fi in recent months.
While the sales figures were strong, investors will also be pleased with the estimated profit result included at the base of the update. Unaudited preliminary accounts point to a pre-tax profit of $91.8 million for the quarter, up almost 28% on the $71.9 million achieved in the prior corresponding period. Notably, that excludes property revaluation adjustments.
