MELBOURNE (Reuters) - David Jones DJS.AX, Australia’s No.2 department store chain, missed analyst forecasts with a 3.1 percent fall in third-quarter same-store sales but said the rate of decline had stabilized and reaffirmed earnings guidance.
David Jones DJS.AX, Australia’s No.2 department store chain, warned in March its full-year earnings could fall up to 40 percent as it invests in a costly overhaul of its strategy, adding service staff and beefing up its online offering, to try to turn around flagging sales.
Analysts had expected a fall of 1.9 percent in third quarter same-store sales, according to a Reuters survey.
“Looking forward to the fourth quarter we note that the first few weeks of the quarter have traded broadly in line with third-quarter trading patterns,” said David Jones Chief Executive Paul Zahra.
“We have consciously decreased the depth, breadth and volume of promotional activity,” he said.
The non-mining sectors of Australia’s economy are struggling under a strong currency, relatively high interest rates, falling home and share values and indebted consumers.
Australia’s biggest department store chain, Myer Holdings (MYR.AX), last week cut its 2012 net profit guidance after a sharp decline in April and May sales.
Myer, which reported a 2.1 percent fall in third quarter same-store sales, gave a long list of headwinds, including higher day-to-day expenses for consumers, and worries about job security and the economy. Qantas Airways (QAN.AX) announced a further 500 job cuts a day earlier.
David Jones said total third-quarter sales, including new stores, fell 2.9 percent from a year earlier to A$399.8 million ($388.95 million).
Shares in David Jones closed at A$2.25 on Wednesday after hitting a 2012 low of A$2.16 last week.
($1 = 1.0279 Australian dollars)
Reporting by Miranda Maxwell; Editing by Richard Pullin