Retailers are enjoying some rare good news today, with new ABS data showing retail sales rose by 3.8% seasonally adjusted in December after the Government’s $10.4 billion stimulus put cash into the hands of consumers.
But the ABS said because the stimulus package was an irregular event, it is impossible to gauge the health of the retail sector without further data.
“Until data is available in future months, it is not possible to determine the trend in retail turnover through the period affected by the stimulus package.”
Still, the stats are comforting for retailers, who will be hoping the Rudd Government’s new $42 billion stimulus package will have a similar impact.
But it wasn’t all good news for the retail sector, with department store giant David Jones suffering a 6.5% decline in fourth-quarter sales from $664 million to just $619.9 million.
First-half 2008-09 sales reached just $1.06 billion compared to $1.14 billion in the previous corresponding period. Like-for-like sales were down 7.9% for the half, and declined 9.2% in final quarter of the year.
Shares fall
The Australian sharemarket has opened lower today, dragged down by disappointing results from BHP Billiton.
The S&P/ASX200 index was down 18 points or 0.51% to 3490.7 at 12.15 AEDST. The dollar gained ground, and is trading at about US65 cents.
BHP Billiton suffered a 57% decline in first half profit after weakening demand and dropping commodity prices, but says it is well suited to survive the downturn.
“We have the real luxury, almost unique in our industry, to be able to continue to plan for the long-term, while not having to be forced into a set of short term decisions that can be damaging,” chief executive Marius Kloppers says.
“Our baseline strategy is unchanged, we want to invest throughout the cycle and we’ve got the cashflow and the balance sheet to do that.”
The group recorded a first half attributable profit of $US2.6 billion, down 56.5% from the $US6.017 billion recorded in the six months to June 2008.
The group blamed the downgrades in profit due to one-off items, including the suspension of the Ravensthorpe nickel mine and costs attributed to the abandoned Rio Tinto takeover bid.
The company’s shares rose by 0.23% this morning to $29.85.
Big loss for Qantas
Qantas has recorded a 66% decline in first half net profit after weakening demand and higher full prices. The company’s profit has dropped from $618 million to just $210 million, but says its full year profit guidance remains the same.
Profit before tax fell 68.2% to $288 million the six months ending 31 December.
“Qantas reconfirms that it expects 2008/09 PBT to be around $500 million. This remains subject to no further significant change in market conditions and fuel prices,” the company says.
Overseas, Wall Street closed higher after news of an alternative stimulus package proposed by Republicans. The Dow Jones Industrial Average jumped 141.53 points or 1.78% to 8078.36. Oil also rose to $US40 a barrel.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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