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Joseph Johnson / Stuff
Hallenstein Glasson will pay shareholders $ 13.7 million in dividends from its first-half earnings.
The accounting professor who called out big business for clinging to wage subsidies when they were profitable and paying dividends says Hallenstein Glasson should review his decision not to repay his $ 5.2 million subsidy.
The retailer reported Friday that first-half earnings rose 29 percent to $ 19.8 million and raised its interim dividend payment to shareholders by 53 percent to 23 cents a share, at a cost of $ 13, 7 million dollars.
Auckland University accounting professor Jilnaught Wong spoke last year about companies listed on NZX that he believed had taken advantage of the high-confidence wage subsidy system. Following public pressure, retailers, including The Warehouse Group and Briscoe Group, reimbursed their wage subsidies after operations recovered.
Hallenstein, who was also among the companies Wong called in, posted an annual profit last year of $ 27.8 million, down 4.3 percent from the previous year, and paid $ 23.2 million in dividends. , citing its strong balance sheet.
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Managing Director Mary Devine said at the time of the annual result in September that the company had no plans to return the wage subsidy, which she said had allowed it to retain staff during the pandemic when stores were closed.
Following the company’s latest earnings result on Friday, Wong asked the company to reconsider its decision.
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Recently retired accounting professor Jilnaught Wong is asking Hallenstein Glasson to reconsider her decision not to repay the government wage subsidy.
“I hope that the board will review the issue of salary subsidy reimbursement, given their better performance and higher dividends,” Wong said. He has recently dropped out of college.
Devine did not immediately respond to a request for comment.
The wage subsidy scheme was established to ensure that people did not lose their jobs during the Covid-19 pandemic. Throughout his life, around 750,000 companies claimed subsidies worth 14,000 million dollars.
Figures from the Ministry of Social Development show that companies had reimbursed $ 732.4 million in wage subsidies as of last week.
In a statement accompanying the first half result, Devine said that the business environment in both New Zealand and Australia “remains challenging, and with the uncertainty of Covid-19 ever present.”
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Hallenstein Glasson CEO Mary Devine says the business environment “remains challenging.”
“The balance sheet remains strong, inventories are well controlled and current business patterns have allowed the company to increase dividend payments,” he said.
Profits at the company’s New Zealand womenswear chain Glassons fell 1.6 percent to $ 5.8 million, while sales increased 15 percent to $ 61.8 million. In Australia, profits increased 71 percent to $ 10.2 million, while sales increased 27 percent to $ 68.4 million.
At the Hallenstein Brothers men’s clothing chain, profits rose 8.4 percent to $ 3.7 million. Sales fell 1.2 percent to $ 51.7 million, which Devine said was the result of declining demand for tailored clothing as more people worked from home and there was uncertainty surrounding sales. events.
The menswear chain was changing its products and repositioning the brand, he said.
The company’s online sales now account for 23.8 percent of all sales, up from 15 percent last year, as many people prefer to shop from home during the pandemic.
Sales in the first seven weeks of the winter season were 17.8% ahead of the same period last year, which Devine said was encouraging, although he noted that the impact of Covid-19 was beginning to be felt both in New Zealand and Australia in the comparable period last year.
The group’s gross profit margin fell to 56.5 percent from 58.3 percent as the shares were transported by air due to shipping delays.
In addition to its New Zealand wage subsidy payments, the company also received $ 5 million in payments from job applicants in Australia last year, noting in its latest accounts that it has received another $ 2.1 million in wage subsidies and other Australian government profits in the first half.
Hallenstein Glasson shares were unchanged at $ 7.50 in mid-afternoon trading Friday. The shares have gained 165 percent over the past year.
