Department store giant David Jones has now upgraded its profit guidance for the first and second halves of 2010 following good sales growth at the Melbourne Bourke Street store.
The company has announced it expects a 10% increase in profit for the first half of the 2010 financial year, with a 5-10% increase in second-half after-tax profit.
In regards to the 2011 financial year, the company said profit after tax is likely to be about 5-10% stronger. The company’s shares have gained 1% to $4.71 this morning as a result of the news.
Chief executive Mark McInnes said in a statement the company was “cautiously optimistic” about the company’s future results.
“Our caution is based on cycling the [2009 fourth quarter] government stimulus, however that said, we are cycling (in February and March) the worst of the 2009 economic downturn,” he said.
“The fact that we will be cycling our worst sales trading performance in February and March coupled with the fact that our redeveloped Bourke Street store is expected to deliver positive sales momentum… and our margins, costs and inventory have been excellently managed, gives us confidence that we are well positioned to trade through the remainder of FY10.”
Meanwhile, Singapore Telecommunications Group has recorded an increase in net profit in the third quarter due to better performances in both Singapore and Australia.
The company announced a 24% increase in net profit to $806 million for the quarter ending December 31, 2009.
“Net profit for the quarter ended December 31, 2009 rose 24% to $S991 million, with… businesses in Singapore, Australia and regional mobile associates reporting improved performance,” SingTel said in a statement to the ASX.
“The group’s revenue posted a 20% gain to $S4.45 billion, driven by steady growth from Singapore and Australia and assisted by the stronger Australian dollar,” the company said.
The company also said subsidiary Optus had increased its postpaid customer base by 164,000 during the quarter, with its total number of postpaid customers now over four million.
Shares open lower due to Wall Street fears
The Australian sharemarket has opened lower today due to mixed leads from both Wall Street and the European stock market.
The benchmark S&P/ASX200 index was down 43 points or 0.95% to 4478.2 at 12.00 AEST, while the Australian dollar lifted slightly higher to US86c.
Commonwealth Bank shares have fallen 1.3% to $52.08, while NAB shares have also fallen 1.5% to $25.09. ANZ lost 1.7% to $20.61, as Westpac fell 2.4% to $22.70.
Macquarie Group has announced it expects profit during the second half of the 2010 financial year to be on the same level as the first half, with the possibility of a 10% increase.
The investment bank said in an operational briefing that second half profit could increase 10% higher than the $479 million in the first half, but the result will depend on “significant swing factors” such as asset realisations and prices.
“Despite improving trends in a number of major markets, we continue to maintain a conservative approach to funding and capital. Our strong balance sheet, strong team and encouraging market conditions provide opportunities for medium-term growth,” chief executive Nicholas Moore said in a statement.
Cochlear has said it expects to post a 15% increase in full-year net profit, with the company also recording a first-half net profit increase of 8%.
The company recorded net profit of $75.2 million for the six months ending December 31, compared to the $69.9 million recorded during the same period in the 2009 financial year.
“Full year NPAT (net profit after tax) is forecast to be at least 15% ahead of last year reflecting continuing momentum from the successful new product launches,” chief executive Chris Roberts said in a statement to the ASX.
Australand records $298 million loss
Australand Property Group has recorded a net loss of $298 million for the year ending December 31, after posting a $40 million profit during 2008.
The company said it expects to pay distributions of 4.1 cents per stabled security during 2010, but managing director Bob Johnston said in a statement the result was a testament to the company’s strength.
“Property valuations now appear to be stabilising with revaluation losses of $14 million in the second half across the $2 billion portfolio… Market evidence indicates that investment property valuations are at, or near, trough levels in the cycle.”
As reported in the Australian Financial Review, the Federal Budget could post a deficit lower than forecast due to higher-than-expected tax revenues.
The report states the forecast $57.7 billion deficit for the 2009-10 financial year could end up being around $43 billion instead.
Treasurer Wayne Swan is set to introduce the budget on May 11, and he is now suspected to reveal forecasts pinning a return to surplus earlier than expected.
Overseas, Wall Street stocks fell below the 10,000-point level for the first time since November as investors sold off bank shares due to European debt fears. The Dow Jones Industrial Average fell 103.84 points or 1.04% to 9,908.39.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
